Who's considered emmigrating because of tax?

JimmyTheWig

I think that's a very valid viewpoint, Randvegeta.

My point, more than anything, is that people always talk about how there is no incentive for the rich to work because of the high tax rate. But there is more incentive for the rich to work than for the poor to work.
I don't know why the person in my example only earns £10k a year. Maybe they only work part time because they have children to look after or any elderly relative to care for. I don't object to the state paying them to do that. Maybe whilst working they are also studying so that in the future they can earn significantly more money (and more than pay back in tax the benefits they received when they were starting out). Maybe they are doing a very worthwhile job that happens to be low paid (in which case if we don't subsidise them then no-one would do that job and we'd all be stuffed).
But that's not the point I was addressing.

They get that money and at present there is very little incentive for them to earn more. If you want them to work more (which I presume you do) then they need the incentive to work more.

Randvegeta

JimmyTheWig wrote: »

I think that's a very valid viewpoint, Randvegeta.

My point, more than anything, is that people always talk about how there is no incentive for the rich to work because of the high tax rate. But there is more incentive for the rich to work than for the poor to work.
I don't know why the person in my example only earns £10k a year. Maybe they only work part time because they have children to look after or any elderly relative to care for. I don't object to the state paying them to do that. Maybe whilst working they are also studying so that in the future they can earn significantly more money (and more than pay back in tax the benefits they received when they were starting out). Maybe they are doing a very worthwhile job that happens to be low paid (in which case if we don't subsidise them then no-one would do that job and we'd all be stuffed).
But that's not the point I was addressing.

They get that money and at present there is very little incentive for them to earn more. If you want them to work more (which I presume you do) then they need the incentive to work more.

Well yes I would agree with this completely.

Everyone needs an incentive to work. I had no idea things were so ****ed up with the current system.

Personally, I think we should scrap the whole tax credit system, up the personal allowance and give non-means tested benefits for certain people. Like child benefits. Any sort of system that rewards staying at home over working is flawed and needs changing.

But, here's one thing that should be said. Even if it is grossly unfair to the lower income groups, they are far less mobile than higher earners. By raising taxes for the super rich, fair or not, if it results in LESS tax revenues for the Government, it's a bad idea.

Surely it is better to tax 5% on $1bn than 52% on £0. Which is exactly what may high income people have done. They've become tax exiles! Is it fair? Maybe not, but we live in a global economy now. Anyone have a better suggestion?

If someone suggests implementing a US type system where worldwide income is taxed regardless of where you are resident, I'm sure there will be a number of people renouncing their citizenship. I probably would!

gadgetmind

JimmyTheWig wrote: »

If you want them to work more (which I presume you do) then they need the incentive to work more.

I quite like the idea of personal allowance being replaced by a similar sum that HMG pays to everyone every year. This would replace current personal allowances, and all pensions, benefits, credits, etc.

Want more than this? Fine, work for it, and start paying tax from pound one and thus starting to give at least something back.

BTW, this payment would work out to roughly £140 a week, so very similar to the proposed flat rate pension. I have no idea how it compares to whatever the dole is called nowadays.

jago25_98

I would say this. It's fine to turn choosing a country into a market, aligning the truth that there is no democracy and that actually it's just capitalism, and that by doing this we are aligning things more smoothly with the truth.

But in practice there are the details.

Yes, you may be able to up sticks and move somewhere else but you are still a British citizen and it may take time to loose that. As such you are still tied in many ways to your country of origin. You could be called back or you could be thrown out. If this is true then you don't want to encourage people to leave the UK, you want to support it.

For me it comes down to, does the government help you do things (liberalise) by going with the force of the market to steer direction, or does it try to limit against the market? That is, is the country and enabler or a disabler?
I think the UK has a lot of things going for it as enabling. These things are not so clear when you are in the UK. Charitable projects and so forth, but also government ideas, schemes and things. Some of them are ok.
You only notice these things when they're gone. In some places you're on your own whether you need a loan or you're dying. Some countries don't have credit ratings at all.

Likewise in Buenos Aires and overall costs are much the same really when you wiegh everything up. Being extremely simplistic I'd say food prices are much the same! Tinned mackrel in Tescos about £1.50, Mackrel here, about £1.50. Sure there are cheaper things but generally it feels about the same.

People think Britain is expensive. It's more a case of everywhere else was expensive but the UK was not because of it's history. I'd say that markets are rebalancing that.

Here's one thing I notice. British charity is very strong for the wealth and British people are active. If that can be redirected to local level Britain will reinvent itself and I think only the positive will survive this financial meltdown. All sorts of coping strategies will come out of the cracks.

If you want to move out of the way for this period there are the practicalities in the details. It seems straightforward but there's always infernal buerocracy.

Generally I find that yes, you do need to be upper class with a relocatable income to move though. It is very hard to move if you need to apply for work visas and it's only going to get worse.

I'd say if you earn more than £40,000 and have a very specialist skilled and valued job you should be able to do it. If you have a business with profit it's easier. If you earn less than £40,000 and your job is some UK specific I think really life's been too easy and actually we've been lucky to be overpaid for globally unmarketable skills. With that you can't escape the UK.

I think thinking just about tax brackets is way too simplistic. You have to live in an area for a month or 2 elsewhere to really wiegh things up. It's no good just going on holiday and thinking this is cheap. You have to be paid locally if that's going to be your income, you have to know the bills - there can be some suprises.

Looking at it the other way. many people in poorer countries are convinced that Britain is the richest country in the world. They simply think that the exchange rate is everything. They have no experience of ripoff Britian and they don't understand what it's like to live in the UK because they only see one side of it. Likewise, it's the same the other way round - we only see the short term.

Thus a 90% tax can be cheaper than a 15% tax. It is hard to do the maths on that but it is also hard to live there for a short while to see how it is too.

Pennywise

JimmyTheWig wrote: »

My point, more than anything, is that people always talk about how there is no incentive for the rich to work because of the high tax rate. But there is more incentive for the rich to work than for the poor to work.

No there isn't. A "rich" person earning £160k doesn't need to earn any more to continue with a fairly decent lifestyle. A "poor" person has a much greater incentive to earn more, at whatever marginal tax rate, so as to improve their income to achieve a "decent" lifestyle.

Not saying it's right, but that's how the behaviour works. A poor person will need all the 27p's that they can get, whereas a richer person may not think it worthwhile to work harder/longer for 50p.

Randvegeta

Pennywise wrote: »

No there isn't. A "rich" person earning £160k doesn't need to earn any more to continue with a fairly decent lifestyle. A "poor" person has a much greater incentive to earn more, at whatever marginal tax rate, so as to improve their income to achieve a "decent" lifestyle.

Not saying it's right, but that's how the behaviour works. A poor person will need all the 27p's that they can get, whereas a richer person may not think it worthwhile to work harder/longer for 50p.

That's an excellent point! The only problem is, many poor people are too lazy to work for more and they are happy to stay where they are. Chavs come to mind

John_Pierpoint

zfrl wrote: »

Fair enough.

But it is still not 50% of your income unless your income is above £900,000 and you don't contribute to a pension. (Checked using an on-line calculator - feel free to correct me.)

However when you come to spend your marginal income you face more taxes.

Take road fuel as an example:

The following table shows the retail price of petrol and diesel (pence per litre) for a selection of untaxed prices:
50 + tax = 129.54 [61.4% tax]
55 + tax = 135.54 [59.4% tax]
60 + tax = 141.54 [57.6% tax]

The government revenue from Fuel Duty was £25.894 billion in 2009, with a further £3.884 billion being raised from the VAT on the duty.
http://en.wikipedia.org/wiki/Hydrocarbon_oil_duty

dori2o

Randvegeta wrote: »

What is the average wage in the UK? But I was just thinking, if you're earning £50k /yr in the UK, after tax, you have a little over £35k, and that's assuming you make no pension contributions and have already paid off/don't have a student loan. Even with this sort of wage, a family of 4, I bet, would struggle to reach anything but an 'okay' standard of living. And I find it somewhat hard to believe that the average family would have a take home income of much more than this.

Sorry but this is the stupidest thing I've ever heard.

We have a household income of just over £20k, we are a family of 4, and we live quite a good life thanks.

I'm sorry but if you cannot live on £50k a year then you have seriously overstretched yourself.

People go on about the 50% tax rate as though it affects everyone, but in reality it affects the top 1% of earners in this country.

If they want to p*ss off and find another country to live in thats fine with me.

The majority of lower and middle income families pay about 34% of their income in tax, yet the higher income families only pay 31%.

It's about time this balance was redressed.

Charlton_Taz

dori2o wrote: »

Sorry but this is the stupidest thing I've ever heard.

We have a household income of just over £20k, we are a family of 4, and we live quite a good life thanks.

I'm sorry but if you cannot live on £50k a year then you have seriously overstretched yourself.

People go on about the 50% tax rate as though it affects everyone, but in reality it affects the top 1% of earners in this country.

If they want to p*ss off and find another country to live in thats fine with me.

The majority of lower and middle income families pay about 34% of their income in tax, yet the higher income families only pay 31%.

It's about time this balance was redressed.

Presumably you don't claim any benefits at all then? Or if you do, then..no...you don't live comfortably on £20K a year.

Where do you live in the country..presumably somewhere fairly cheap? My childcare costs (for one child) cost the equivalent of a roughly £18K salary alone!! (£1200 a month!)....so yes, my husband and I definately need to earn more than £20K in our household to survive!

How the heck do you calculate than at higher income people pay less tax than lower/middle earners??? And in terms of telling that top 1% to p!ss off I suggest you read the article below:

http://www.telegraph.co.uk/finance/personalfinance/consumertips/tax/8321369/Top-1-of-workers-pay-quarter-of-all-income-tax.html

tillycat123

dori2o wrote: »

Sorry but this is the stupidest thing I've ever heard.

We have a household income of just over £20k, we are a family of 4, and we live quite a good life thanks.

I'm sorry but if you cannot live on £50k a year then you have seriously overstretched yourself.

People go on about the 50% tax rate as though it affects everyone, but in reality it affects the top 1% of earners in this country.

If they want to p*ss off and find another country to live in thats fine with me.

The majority of lower and middle income families pay about 34% of their income in tax, yet the higher income families only pay 31%.

It's about time this balance was redressed.

You get a personal tax allowance.
You get get tax credits, Childrens tax credits.
You get family allowance.


Please add all that to you 20K and come back with a new number.