Tax Credits

CLAPTON

dktreesea wrote: »

If the NMW were hiked up to a proper living wage, then the rise, provided the worker is prepared to work full time, should more than compensate him for the loss in tax credits. And even if it were not, the government can compensate him further with a tax rebate once he files his tax return. As in a tax rebate of income tax that has been paid, not a "tax credit" where no tax has been paid.


If the person is already earning more than £9.50 an hour, (a reasonable level for the NMW) then why should other tax payers subsidise his wages?

so, one way or another, you think that a couple with 3 kids; one parent working 35 hour per week servicing coffee and paying 500 per month rent, should end up with £30,000 net per annum

michaels

dktreesea wrote: »

If the NMW were hiked up to a proper living wage, then the rise, provided the worker is prepared to work full time, should more than compensate him for the loss in tax credits. And even if it were not, the government can compensate him further with a tax rebate once he files his tax return. As in a tax rebate of income tax that has been paid, not a "tax credit" where no tax has been paid.


If the person is already earning more than £9.50 an hour, (a reasonable level for the NMW) then why should other tax payers subsidise his wages?

Of course unemployment would go from the current UK 5.2% to the French style 10% resulting in a big benefits bill but you can't have both high minimum wages and high employment and that level of unemployment would help to deter EU migrants.

PasturesNew

michaels wrote: »

... resulting in a big benefits bill ...

How does the benefits bill compare though:

- person with all the top ups, in a job, also possibly claiming childcare
- person just on the dole, no top ups, no childcare costs required?

I bet keeping two people IN part-time jobs and topped up is a greater benefits cost than having them sitting at home and one full-time worker on proper wages not having all the top ups.

CLAPTON

PasturesNew wrote: »

How does the benefits bill compare though:

- person with all the top ups, in a job, also possibly claiming childcare
- person just on the dole, no top ups, no childcare costs required?

I bet keeping two people IN part-time jobs and topped up is a greater benefits cost than having them sitting at home and one full-time worker on proper wages not having all the top ups.

well, the 'unemployed' would be coached to start a self employed business from home or sell the big issue : no need to actually make a profit but one can then claim 'employed' benefits.

dktreesea

CLAPTON wrote: »

so, one way or another, you think that a couple with 3 kids; one parent working 35 hour per week servicing coffee and paying 500 per month rent, should end up with £30,000 net per annum

I'm all for someone working full time earning £30k a year. I just want to employer to pay it rather than the taxpayer. Even though ultimately the taxpayer picks up the bill as a consumer, there at least is an element of choice. If we don't think a coffee from Starbucks is worth £3 we don't have to buy it. These large foreign companies pay hardly any corporation tax. No bother. They want to make money out of Brits, they need to be paying the Brits they hire properly first.



I'm sick of companies that cheat and governments who have policies that give them a way to cheat. Things like no national insurance contributions for the first £156 a week. Transfer pricing of sham management fees to get the profits into a different country. Why hasn't the government outlawed transfer pricing? Plenty of other developed countries do.


£9.50 an hour for a 35 hour week is £25,688 p.a. I'm sure staff working for Starbucks, Costa, Caffe Nero and the like make much more than that for their employers. Tesco, in spite of consumers deserting their supermarkets in droves, made £354 million in the first six months of this year. They can certainly afford to pay their employees properly.


You know why I like shopping at Waitrose and John Lewis? Because when I hand over the cash I know some part of the profit is going directly into the pocket, via their end of year bonus scheme, of the person who served me.

dktreesea

michaels wrote: »

Of course unemployment would go from the current UK 5.2% to the French style 10% resulting in a big benefits bill but you can't have both high minimum wages and high employment and that level of unemployment would help to deter EU migrants.

I don't see why. Most people are already paid at least £9.50 an hour, if the median wage (£28k or so) is to be believed. Retailers, who are the biggest employers and the lowest payers in the country, aren't about to shut up shop and retreat back to whichever country they hail from just because they have to pay their staff properly.

CLAPTON

dktreesea wrote: »

I'm all for someone working full time earning £30k a year. I just want to employer to pay it rather than the taxpayer. Even though ultimately the taxpayer picks up the bill as a consumer, there at least is an element of choice. If we don't think a coffee from Starbucks is worth £3 we don't have to buy it. These large foreign companies pay hardly any corporation tax. No bother. They want to make money out of Brits, they need to be paying the Brits they hire properly first.



I'm sick of companies that cheat and governments who have policies that give them a way to cheat. Things like no national insurance contributions for the first £156 a week. Transfer pricing of sham management fees to get the profits into a different country. Why hasn't the government outlawed transfer pricing? Plenty of other developed countries do.


£9.50 an hour for a 35 hour week is £25,688 p.a. I'm sure staff working for Starbucks, Costa, Caffe Nero and the like make much more than that for their employers. Tesco, in spite of consumers deserting their supermarkets in droves, made £354 million in the first six months of this year. They can certainly afford to pay their employees properly.


You know why I like shopping at Waitrose and John Lewis? Because when I hand over the cash I know some part of the profit is going directly into the pocket, via their end of year bonus scheme, of the person who served me.

it would seem to me that
£9.5 x 35 x 52 = £17,290
but maybe I am just old fashioned

the rest of the 30,000 net comes from other people's labour with no contribution to the NHS or Education etc at all.

glad you shop at JL and Waitrose

Generali

Whitbread (owners of Costa Coffee) made £463,800,000 in profit in 2014-5. They have 45,000 employees.

https://www.whitbread.co.uk/content/dam/whitbread/download_centre/reports_and_results/2015/Interactive-Annual-Report-2015.pdf

According to the TUC, the average working week is 43.6 hours:

http://www.ibtimes.co.uk/burnout-britain-long-work-hours-culture-returns-warns-tuc-1519158

If each of those staff members was to get a payrise of £2.80 the wage bill of Whitbread would rise by £263,692,800 so their profits would be cut by a bit over 55%.

Thrugelmir

dktreesea wrote: »

I would have said though that tax credits, for the most part, isn't paid to people doing nothing but rather enables the employers to keep £30 billion a year in their pockets and not pass it onto the employees it should be paid to.

A mere £30 billion. Such a small number. In 2014 the top 100 FTSE Companies only made £79.8 billion in operating profit, i.e. before tax dividends etc. Sounds if your Brown's nemesis in wanting to raid pension pots of those that work and save yet again.

michaels

Thrugelmir wrote: »

A mere £30 billion. Such a small number. In 2014 the top 100 FTSE Companies only made £79.8 billion in operating profit, i.e. before tax dividends etc. Sounds if your Brown's nemesis in wanting to raid pension pots of those that work and save yet again.

Of course if you are looking to invest capital and your returns are minimal in the UK because wages are so high then you will invest elsewhere...shame that means the jobs will go elsewhere too