The 50% Tax Rate

kabayiri

I think we can all moan about tax rates, be they 20%, 40% or 50%.

"How can the government know how badly impacted I am" people will say.

The time to complain is at the ballot box. Right now, we might as well get on with things. Sure, your tax may be higher but just look how much cheaper your mortgage repayments are. You have to look at the whole package.

RJP33

tillycat123 wrote: »

No but take home pay of 2 earner and all the tax credits they would get = ? My point being if only one person is the earner they are massively penalised and seen as super rich, when 2 lower earners are perhaps not that much differently well off with regards to take home pay and tax credits they also get.

Tax credits are worked out on joint income and I think tax banding should as well. Thats why loads of family's are about to lose child benefit.

Such is the way the tax system works it's much better to have both earning 30k each, rather than 1 earning 60k.

dawyldthing

by the time you add National Insurance on it works out at 31% for lower bands, 51% for middle and 61% for higher. I do believe everyone should be taxed fair but if i had to pay 61% between the two I don't think i'd be looking to get that sort of job as like someone said there will be a reason why they get paid that much (generally talking, unless there something related to the government.......

lostinrates

Pennywise wrote: »

But, on the other side of the coin, in a lot of cases, the worker wouldn't be able to earn that much if their partner also worked - with relatively high wages usually comes the downsides, such as longer hours, working away from home more. This is often only possible because the other partner stays at home. If you have two workers, then both are going to have to do their fair share of house work, cleaning, cooking, etc., in the evenings and weekends, meaning that they are more likely to have more normal "9-5" jobs, earning closer to average wage. I don't really see an "advantage" of being on call, working unsocial hours, travelling away a lot, etc., which usually comes with higher earning jobs!

Actually, although we don't have children this is much of the issue here.

Only one holiday ever has not been cancelled at very late notice..sometimes while on route. If I were employed this would be very difficult because my employer couldn't be expected to schedule around dh's.

I got very used to attending social stuff by my self, and cringingly empbarrassed to excuse dh at no notice.

Travel often happens with no noitice, a call comes saying go NOW, which airport are you nearest...a ticket will be waiting...

if you had childcare based on that it would need to be full time and very flexible.....even things like leaving a washing machine or a slow cooker on become an issue....who wants to come home three days later to mouldy clothes and food?


We think we are very lucky to have a good income, and its a choice we make, but its not just like being paid more for a job he could do locally, it does have lifestyle ramifications. Its not uncommon for colleagues burn out in 30s and 40s and for marriages to suffer...particularly when one is not rolling with the lifestyle.

movilogo

I don't really see an "advantage" of being on call, working unsocial hours, travelling away a lot, etc., which usually comes with higher earning jobs

It is really down to choice and circumstances. Some people value money higher than anything. Some others prefer enough time to pursue own hobbies.

For example, I could have earned more but I decided that I am happy with less wage and posting in MSE forum from time to time

lostinrates

movilogo wrote: »

It is really down to choice and circumstances. Some people value money higher than anything. Some others prefer enough time to pursue own hobbies.

For example, I could have earned more but I decided that I am happy with less wage and posting in MSE forum from time to time

We value time to persue our hobbies, but without the money couldn't.

movilogo

We value time to persue our hobbies, but without the money couldn't.

Agreed but not all hobbies require enormous amount of money where as they all require considerable amount of time!

I ,for example, love to write non-fictional articles. I don't need anything other than a computer to pursue it.

Of course, if your hobby is yachting, then you need a very wallet. Then again, you probably have little time to pursue your hobby seriously because you have to work long hours to get that fat wallet.

tillycat123

Pennywise wrote: »

There should definitely be an "opt in" system for a household to be taxed as a household instead of individually, so that tax allowances and rate bands can be shared. If it were optional, then you'd still have the default position of independent taxation. Benefits work on the basis of households rather than individuals, so it's logical that taxation should follow the same methodology.

Totally agree this is how it should work. Nobody has put up their household income with 2 jobs net pay and tax credits though they get I see.

I really wanted to see if £4500 a month was so super rich for a household income to be after tax.

milliebear00001

Our tax system isn't historically just about raising money. It has (in modern times at least) been very much about redistribution of wealth. This is the case in most modern countries also.

The principle of fairness in our tax system, is that those who will can afford to pay more for the upkeep of services, should pay more for the upkeep of services.

You may, or may not, agree with the fairness of this principle, but it is the principle the whole system was built upon. If it was abandoned in favour of the same tax rate for all, we would see less money coming into revenue, with the consequence that we would not be able to pay for services currently available to all members of our society. We would also see the poor paying a proportionally greater price for those services; in basic terms, taking 20% of a £15,000pa salary is going to affect that person's standard of living far more than taking 20% of somebody earning £100,000pa.

dtsazza

Procrastinator333 wrote: »

My 2 pence is a reference to something called the "veil of ignorance". Just say you woke up tomorrow and were told that in a short while you were about to be born again. You are not told if you are going to be born to drug addict, a food technician, a marketing manager, solicitor, btl king, entrepreneur, landed gentry, or even royalty. You also don't know how you will fair in this world, you might be the bright spark who invents bubble wrap, or you may be struggle to string 2 sentences together. Now, before you are born you can set the rules of the tax and benefits system (if you really want to complicate it). Try to detach yourself from your current position and what would you do.

That's a very interesting though experiment, thanks for bringing it up.

For my part, the core ideal underpinning everything would be responsibility. That's not the same as saying that everyone has to fend for themselves, but saying that the system has to be such that people are incentivised to improve their own situation, and take the consequences of their own actions. It doesn't mean they're on their own - society, the state and other people will be there to help them out on the way up.

As for re-distribution of wealth, I don't think that's fair at all. I wouldn't want to be given someone else's money simply because he had more than me - be that now of in a hypothetical new life. What I would want is the opportunity to be able to use my skills and talents to make sufficient money for myself, to the extent that my abilities would take me.

That's my view of fairness - the fairness to succeed or fail just like everyone else. If you limit either side, society suffers (IMHO).


(So in terms of the tax, I suppose ideally flat amounts make the most sense. But this would have to be tempered by pragmatism in terms of the steps that were required to generate equal opportunities and the money it would take to do so. In that context, a flat percentage would mean the rich pay more of the temporary expenditure during this transitional period.)