Marcus sort code.

short_butt_sweet

Uxb wrote: »

Another interesting related figure not in the data but available elsewhere and much listed on the web is that 27% of all UK income tax receipts is paid by the top 1% of earners in the UK.
This all rather suggests that the top earners are over contributing to UK tax receipts rather than 'getting away with it'.

it's a misleading statistic, because it gives the impression that income tax receipts and total tax receipts are pretty similar. in fact, only about 28% of total tax receipts are from income tax. income tax is progressive, i.e. as people's income rises, they pay a higher proportion of it in tax. most of the other 72% of taxes are regressive, i.e. as people's income rises, they may a smaller percentage of it in other taxes (e.g. national insurance contributions, VAT, council tax).

overall, the poorest 20% of the population pay the highest percentage of their income is in total taxes. the system is regressive. if income tax weren't progressive, the system would be even worse.

it's also misleading to refer to the biggest income tax payers as the "top earners", because the highest incomes also include people who are not earning at all but living off income from their capital.

Should of course these 1% decide to leave the UK that will leave the rest of us with a rather large hole to fill by increasing our tax rates considerably.

an almost complete myth. almost nobody leaves for tax reasons. top earners have jobs in the UK; it is not at all simple to leave and get a similarly paid job in another country. and people have family ties keeping them here, especially after they have children. and most people just want to stay here.

the most mobile group are young people, after finishing education and before starting, or in the early stages of, a career. some of these do choose to move. but they don't mostly move to very low tax countries. they move to where there are opportunities. that's almost always to countries that tax incomes at comparable rates to the UK.

let me suggest a good approximation: the higher the taxes on income, the more prosperous the country.

there's very little tax on income in the poorest countries. significant taxes on income in the rich countries (excluding tax havens with tiny populations). and especially high taxes on income in scandinavian countries, which have the highest living standards.

Uxb

Well I know several who have indeed left for tax reasons
Now non doms with assets in the UK or totally gone entirely.
Another has recently said they are leaving for France where they already have a property. The motivation is simply that the French have recently significantly reduced their wealth tax - all this is being done for tax reasons.
These are all very high earning international moving people.
They sold their companies and left - rather than pay any tax on their proceeds in the UK.
Another is making plans to leave should Corbyn get in - again all for tax reasons.

If indeed higher taxes on income resulted in a more prosperous country why not make tax 100% !
In the 1970's we had investment income surcharge of 15% on top of a 70% top rate tax bringing a high earner with savings income up to a marginal tax rate of 90% on it. Far from being prosperous the result was the UK had to go to the IMF for a loan so broke were we.

Edit:
We can see the effects of higher taxes with the figures just released on Stamp Duty.
The rate has been increased at the top end with the inevitable result that rather than getting in more you get in less as people modify their behaviour to pay less of the tax.

short_butt_sweet

france has comparable tax levels to the UK. so that's very much consistent with my point that people move to major economies, with comparable tax rates, not to tax havens.

people who have assets, as opposed to being top earners, will, even if they go, leave their assets here, or in other major economies, because there are hardly any assets located in tiny tax havens. so we can still tax them.

your suggestion that high rates of income tax are the reason the UK economy had serious problems in the 1970s is frankly absurd. we had similarly high rates of income tax in the whole period from the 1940s to the 1970s, which includes the 2 or 3 decades in which capitalism worked best, in the sense that it had benefits that spread to just about all of the population.

the current version of capitalism is failing. most people are getting poorer. a few people are getting much richer. something needs to change, radically. corbyn's labour is the only major political party in the UK making any attempt to address those problems. the rich people who rail against corbyn are just trying to grab even more wealth, even as that hurts most other people, and makes the whole economy more fragile. i might have more respect for them if they had some alternative plan for how to reform capitalism, curb the excesses, spread the benefits wider, etc; but they don't. corbyn is the only game in town.