The 50% Tax Rate

wotsthat

bendix wrote: »

The Asians you are talking about are UK Asians in race only - they have become westernised in their attitudes, precisely by the nanny-state mentality that both Loughton and I are deriding.

But you knew that already.

Come to Asia StevieJ and live here like both LM and I do/have done.

You will see a completely different way of thinking.

My wife is Thai. She was in the UK recently during the riots. I tried to explain to her why they were happening, but she kept coming back to one point, which can be summarised thus: "But your Government is so kind to them. If they don't have jobs, they can still get lots of money, can still eat, they look like they have good clothes and they have nice Phones. Why are they trying to destroy that society when they get so many good things.?"

My answer echoed LM's. Because we spoiled them.

Come to Asia, and you will see a pervasive ethos built around the desire for self-betterment, a society where people save for their security (because they can't rely on the state), and where as a result they work hard and want to improve themselves and their families.

Curiously, those were very UK traits until that national ethos was destroyed by an excessive over-reliance on welfare support.

I spend some time working in Thailand as well and agree with the above.

The drive of people to ensure that their children are well educated is amazing. They work long hours and still enthusiastically help with homework and are actively involved in supporting schools.

The over generous benefits system in Europe and the UK has helped to create a flabby, unmotivated and unproductive drag on the economy.

Part of the problem is, I think, that governments think that generous benefits will buy votes. They clearly don't otherwise Labour would have won the last election - the people in receipt of these benefits probably couldn't be arsed to vote.

My anecdotal (I've posted it before). I know a Labour party member who regularly goes door knocking before each election. At one house on a workless estate the lady of the house who was !!!!ed off at being woken at 11:00am said she'd be voting Conservative. Why? Her benefits were late that month going into her bank account!

People are being failed by the benefits system. From research I've seen workless people have low self esteem and are more prone to illness and mental health problems.

lostinrates

wotsthat wrote: »

I spend some time working in Thailand as well and agree with the above.

The drive of people to ensure that their children are well educated is amazing. They work long hours and still enthusiastically help with homework and are actively involved in supporting schools..

fwiw you don't have to go to Asia to see this. Independant/private schools I was at have Asian....AND other international students in them who display work ethic whether they come for a year or three years or the entire secondary years. They work harder and find it more relaxed. Its really not just Asians though.

cepheus

From the OP

However if you can cut taxes without decreasing takings by making this a more attractive country for the wealthy to live and pay taxes, then why wouldn’t you do it?

Strangely enough even if this was the case, which I very much doubt, there are still very very strong arguments for not cutting taxes for the rich. I have described them in this thread.

Why equality is better for everyone

Pennywise wrote: »

Have to agree that high taxes are just political gesturing and do nothing to bring in more tax....

The thing is that once you've got someone whose earnings are well above average, or who has assets well above the average person, a lot of their income, spending, investments, etc will be discretionary. With that comes a lot of scope of changing behaviour. I'm not meaning dodgy tax planning schemes or tax evasion. I'm meaning simple things, like working less hard, to earn less money, or putting more money into tax-efficient savings, or planning purchase and sales of investments over several years to take advantage of each year's rates/allowances, etc. They only need to do this when tax rates reach beyond what the person regards as acceptable. When you get high rates, perception is that they're not acceptable and people's behaviour changes to avoid them, often meaning that HMRC get nothing whereas otherwise with a lower tax rate, they'd have got maybe 20-30%!

If I understand it your argument, it seems to say we can't collect taxes from the rich because they will work less hours, or place their earnings in one of the numerous legal tax avoidance schemes.

An obvious answer is to close the tax avoidance schemes. What allows us to collect the 40% rate, do we close that as well? Hell, perhaps we shouldn't collect tax at all like the Greeks?

With regard to working less hours, so what? Doesn't this create more job opportunities for others? What is good about working long hours anyway?



Perhaps you all better step back a minute and attempt to understand the implications of all this tax dodging and take some responsibility for it. It seems to me that people will find any excuse for their greed.

atush

I think the welfare state as created origianlly was good thing. Bringing up some who would die on the street into some sort of living/way into prosperity/good health.

But to raise it to a place where it was comfortable and even convenient was a total disaster and has ruined society- that along with the left wing feminist idea that Marriage is a BAD thing.

It may have been in the 1600-1900s and up to mid 20th when women were treated as chattel, but today it gives far better financial/legal protection. I see non married partners (mainly women) who lose out all the time. And children of non married parents (for whatever reason) statistically dont' do as well at school no matter what Labour says or does.

holly_hobby

I haven't read this whole thread, but the last couple of posts.

Tax dodging/evasion (amended) is illegal - tax mitigation products/schemes are perfectly legal and open to all to utilise.

If you are whats classed as a top earner (150k+) to fall into the 50% tax band - you are earning this level of salary because your professional expertise/position warrants it (and you have studied and grafted for it), and/or you are a successfull business owner - which involves taking risks and working to acheive the same.

We need all, but especially, higher rate tax payers here in the UK, to help fund for the huge burden of the social welfare state we operate - although the new gov are trying to address some of the madness of the benefits system they inherited.

What we don't want is the large tax contributors to take themselves, their companies etc outside of the UK tax system due to the burden of tax levied 50p in every £1 is some tax levy - which is why tax mitigation products, investments, schemes etc for such earners are both valuable and essential, and don't forget are actually introduced by HMRC themselves.

Holly

A._Badger

I enjoy reading this forum with its recurring fantasies about 40 per cent tax rates and how we should be so happy to pay them. The truth is, of course, that the tax system in the UK is utterly munged - with many paying in excess of 60%, particularly - ironically - the lower income working class driver/drinker/smoker.

And what's the remedy that pings in the narrow brains of collectivists? More tax or even greater Big Brother tactics to enforce a clearly dysfunctional system.

Maybe Ayn Rand had it right when she suggested a strike by tax payers?

After all, they can put us inside for refusing to pay tax. There's not a lot they can do if we just shrug, put on our coats and stop working.

And if people actually had to hand over that 60%, in cash, every week, instead of having it concealed in PAYE, NIC, VAT and all the rest of the sugar-coated palliative wrapping material the State uses, I suspect such a strike would be forthcoming tout de suite!

lostinrates

holly_hobby wrote: »

I haven't read this whole thread, but the last couple of posts.

Tax dodging/avoidance is illegal - tax mitigation products/schemes are perfectly legal and open to all to utilise.

Avoidance is legal. Evasion is not.

If you are whats classed as a top earner (150k+) to fall into the 50% tax band - you are earning this level of salary because your professional expertise/position warrants it (and you have studied and grafted for it), and/or you are a successfull business owner - which involves taking risks and working to acheive the same.

£100k, not 150, and it ''works out''as more than 50%

We need all, but especially, higher rate tax payers here in the UK, to help fund for the huge burden of the social welfare state we operate - although the new gov are trying to address some of the madness of the benefits system they inherited.

What we don't want is the large tax contributors to take themselves, their companies etc outside of the UK tax system due to the burden of tax levied 50p in every £1 is some tax levy - which is why tax mitigation products, investments, schemes etc for such earners are both valuable and essential, and don't forget are actually introduced by HMRC themselves.

Holly

Tha madness of trying to work out whether I should buy a fridge or not before spring, and a dishwasher, and how we'll get through winter with no central heating when dh is a HIGHER RATE TAX PAYER...because of the necessity,and it IS a necessity, to make sure every one is safe, warm and fed is weird. DH will be paying, for example, for example, better off older people's winter fuel allowance, then coming home at weekends to chop wood to keep one room of our house warm....

Being £100k is a lot, there is no sense in arguing it is not a lot compared to an average wage of £25k, but the idea that one can do what ever one wants with no thought to spending on that sort of income is just not true. You have more choice (I chose to get ONE of the appliances we need this month ad I'm grateful we can afford that one)....but you still have to make choices not have it all.

lostinrates

A._Badger wrote: »

I enjoy reading this forum with its recurring fantasies about 40 per cent tax rates and how we should be so happy to pay them. !

I don't mind tax being higher here than in some of the places talked about. I want to live somewhere that provides well for its people who are unable too, those with health problems, and the elderly with no money and family, and children. But its that with a very significant tax rate education we are told isn't providing people fit for employment by some firms, that choice, which is part of what makes for a healthily diverse population fit to tackle different challenges we face) is narrow and we STILL fail some of the disadvantaged and seek...thorough all strata of society, to evade responsibility.,..for what we receive and what we should give.

cepheus

A._Badger wrote: »

The truth is, of course, that the tax system in the UK is utterly munged - with many paying in excess of 60%, particularly - ironically - the lower income working class driver/drinker/smoker.

So how are you suggesting the health effects of these should be paid and discouraged if not via alcohol, fuel or tobacco duty? Perhaps corporate taxes on the tobacco, petroleum and drinks companies? Providing the cost is passed onto the user so that it discourages them from using these products I suppose that is OK, but it has the same effect doesn't it?

The poor drink less alcohol than the rich

"People on higher incomes have always drunk more than lower income groups, as they can afford more alcohol," he said

http://www.bbc.co.uk/news/health-12008862

Tax is more effective at reducing smoking in the poor than the rich
http://www.bmj.com/content/309/6959/923.full

At least the poor also have the option to avoid most of these taxes.

A._Badger wrote: »

And what's the remedy that pings in the narrow brains of collectivists? More tax or even greater Big Brother tactics to enforce a clearly dysfunctional system

It is quite clear that you haven't understood the concept of inequality. There are two ways to remedy this, more taxes (or less pay) for the rich or less taxes (or more pay) for the poor. This assists social cohesion and subsequently requires less overall tax to pay for police, prisons, ill health and so on. There is no evidence that more equal states have higher taxes overall.

It is your narrow thinking which would generate a nightmare state, with citizens terrified to walk on the street at night, and security cameras and private police defending the property of the rich. If so don't worry, we are getting there, some US cities are there already.

kabayiri

In the context of our economic situation, the 50% tax rate is a non issue in my view.

On it's own it isn't going to generate much tax revenue to reduce the deficit.

Dropping the rate won't bring in many foreign wealthy people. They weren't exactly flooding in prior to it's introduction were they?

We'd be much better off raising the tax threshold at which people pay tax. This plus a squeeze on benefits will encourage people back to work.