Tax on wealth suggested

Thrugelmir

A._Badger said:

thegentleway said:

zagfles said:

thegentleway said:

Black_Cat2 said:

Being taxed on how much your pension is worth seems unfair to me (if I read this correctly?).  We are encouraged to pay what we can into one to support our retirement so how is it then fair to bring in a tax on it now?  DC and DB pensions meant you sacrifice your salary to be entitled to them and take the gamble that your hard earned money may go up as well as down 🤔

I'm the first to admit I've probably missed the point lol, be kind 😘

You can use that argument to make out all taxation is unfair. E.g. I work hard at my job so it’s unfair that the government takes a cut of my income.
This kind of selfish greedy thinking doesn’t consider how to pay for defence, healthcare, infrastructure, etc... that we all benefit from. Without government expenditure you wouldn’t have a job or a pension in the first place. 

No it isn't. The PPs point seems to be that we are encouraged to support ourselves in retirement by paying into a pension, if the government keep changing the goalposts about how they're taxed etc then that's similar to retrospective taxation, and it will cause people to lose faith in pension savings. Nothing at all like whinging about taxes on employment income. If the govt put taxes on employment income up then people can decide eg not to work overtime etc in the future because it's not worth it. Rather than retrospectively getting a bill for extra tax on the overtime they worked in the past.

You’re welcome to your opinion but I think it’s the same logic:
you can’t tax pension coz you discourage people saving for retirement is the same as you can’t tax higher earners more coz you discourage hard work and career progression. It’s the same very weak argument against taxation which you can apply to anything you don’t want taxed.

In what way is it a weak argument? I have known more than a few tradesmen and small business owners who have consciously avoided growing or expanding their businesses because 'it's not worth it'. High taxation is a very real disincentive. It also encourages tax evasion so tends to be self-defeating. 

Anybody with the drive to be succcessful worrries about making money first then mitigating tax liabilities afterwards. Nothing wrong in being content with ones lot.  

thegentleway

Thrugelmir said:

A._Badger said:

thegentleway said:

zagfles said:

thegentleway said:

Black_Cat2 said:

Being taxed on how much your pension is worth seems unfair to me (if I read this correctly?).  We are encouraged to pay what we can into one to support our retirement so how is it then fair to bring in a tax on it now?  DC and DB pensions meant you sacrifice your salary to be entitled to them and take the gamble that your hard earned money may go up as well as down 🤔

I'm the first to admit I've probably missed the point lol, be kind 😘

You can use that argument to make out all taxation is unfair. E.g. I work hard at my job so it’s unfair that the government takes a cut of my income.
This kind of selfish greedy thinking doesn’t consider how to pay for defence, healthcare, infrastructure, etc... that we all benefit from. Without government expenditure you wouldn’t have a job or a pension in the first place. 

No it isn't. The PPs point seems to be that we are encouraged to support ourselves in retirement by paying into a pension, if the government keep changing the goalposts about how they're taxed etc then that's similar to retrospective taxation, and it will cause people to lose faith in pension savings. Nothing at all like whinging about taxes on employment income. If the govt put taxes on employment income up then people can decide eg not to work overtime etc in the future because it's not worth it. Rather than retrospectively getting a bill for extra tax on the overtime they worked in the past.

You’re welcome to your opinion but I think it’s the same logic:
you can’t tax pension coz you discourage people saving for retirement is the same as you can’t tax higher earners more coz you discourage hard work and career progression. It’s the same very weak argument against taxation which you can apply to anything you don’t want taxed.

In what way is it a weak argument? I have known more than a few tradesmen and small business owners who have consciously avoided growing or expanding their businesses because 'it's not worth it'. High taxation is a very real disincentive. It also encourages tax evasion so tends to be self-defeating. 

Anybody with the drive to be succcessful worrries about making money first then mitigating tax liabilities afterwards. Nothing wrong in being content with ones lot.  

It's more than nothing wrong. According to many wise people before us like the Buddha it's what we should aspire for. You only have two options: getting what you want or wanting what you have. The problem with the former is hedonic adaptation: when are lucky enough to get what you want, you will soon want something else and it all starts again. The only way to break free from the hedonic treadmill is to be content with one's lot!

zagfles

thegentleway said:

Thrugelmir said:

A._Badger said:

thegentleway said:

zagfles said:

thegentleway said:

Black_Cat2 said:

Being taxed on how much your pension is worth seems unfair to me (if I read this correctly?).  We are encouraged to pay what we can into one to support our retirement so how is it then fair to bring in a tax on it now?  DC and DB pensions meant you sacrifice your salary to be entitled to them and take the gamble that your hard earned money may go up as well as down 🤔

I'm the first to admit I've probably missed the point lol, be kind 😘

You can use that argument to make out all taxation is unfair. E.g. I work hard at my job so it’s unfair that the government takes a cut of my income.
This kind of selfish greedy thinking doesn’t consider how to pay for defence, healthcare, infrastructure, etc... that we all benefit from. Without government expenditure you wouldn’t have a job or a pension in the first place. 

No it isn't. The PPs point seems to be that we are encouraged to support ourselves in retirement by paying into a pension, if the government keep changing the goalposts about how they're taxed etc then that's similar to retrospective taxation, and it will cause people to lose faith in pension savings. Nothing at all like whinging about taxes on employment income. If the govt put taxes on employment income up then people can decide eg not to work overtime etc in the future because it's not worth it. Rather than retrospectively getting a bill for extra tax on the overtime they worked in the past.

You’re welcome to your opinion but I think it’s the same logic:
you can’t tax pension coz you discourage people saving for retirement is the same as you can’t tax higher earners more coz you discourage hard work and career progression. It’s the same very weak argument against taxation which you can apply to anything you don’t want taxed.

In what way is it a weak argument? I have known more than a few tradesmen and small business owners who have consciously avoided growing or expanding their businesses because 'it's not worth it'. High taxation is a very real disincentive. It also encourages tax evasion so tends to be self-defeating. 

Anybody with the drive to be succcessful worrries about making money first then mitigating tax liabilities afterwards. Nothing wrong in being content with ones lot.  

It's more than nothing wrong. According to many wise people before us like the Buddha it's what we should aspire for. You only have two options: getting what you want or wanting what you have. The problem with the former is hedonic adaptation: when are lucky enough to get what you want, you will soon want something else and it all starts again. The only way to break free from the hedonic treadmill is to be content with one's lot!

Indeed. The problem is that "getting what you want" for some people means "getting what others have", ie want driven by jealousy of others. Particularly others you can see, eg your neighbours brand new BMW, rather than others you don't see, eg a starving child in a war torn African country.

Grumpy_chap

thegentleway said:

zagfles said:

thegentleway said:

Black_Cat2 said:

Being taxed on how much your pension is worth seems unfair to me (if I read this correctly?).  We are encouraged to pay what we can into one to support our retirement so how is it then fair to bring in a tax on it now?  DC and DB pensions meant you sacrifice your salary to be entitled to them and take the gamble that your hard earned money may go up as well as down 🤔

I'm the first to admit I've probably missed the point lol, be kind 😘

You can use that argument to make out all taxation is unfair. E.g. I work hard at my job so it’s unfair that the government takes a cut of my income.
This kind of selfish greedy thinking doesn’t consider how to pay for defence, healthcare, infrastructure, etc... that we all benefit from. Without government expenditure you wouldn’t have a job or a pension in the first place. 

No it isn't. The PPs point seems to be that we are encouraged to support ourselves in retirement by paying into a pension, if the government keep changing the goalposts about how they're taxed etc then that's similar to retrospective taxation, and it will cause people to lose faith in pension savings. Nothing at all like whinging about taxes on employment income. If the govt put taxes on employment income up then people can decide eg not to work overtime etc in the future because it's not worth it. Rather than retrospectively getting a bill for extra tax on the overtime they worked in the past.

You’re welcome to your opinion but I think it’s the same logic:
you can’t tax pension coz you discourage people saving for retirement is the same as you can’t tax higher earners more coz you discourage hard work and career progression. It’s the same very weak argument against taxation which you can apply to anything you don’t want taxed.

I don't think it is the same logic.

Anyone can make a decision today on how much work they will choose to do based upon whether it is "worth it" given the level of income tax that will become due today.

Pension assets have been built up based on decisions taken yesterday, so to now apply a "wealth tax" on pensions retrospectively is not the same.  An individual cannot decide to "uncontribute" to their pension now that this tax is a possibility.

Those that do have pension assets have been encouraged to do so by successive Governments as a means to lessen the burden on the tax payer.  If the Government can levy a "one-off" retrospective tax on pension assets then the Government will be able to do that again and again until it becomes the norm.  At this point, future savings into pension funds will diminish and future tax payers will need to provide far higher levels of support to the elderly.  As such, imposing retrospective "wealth" taxes may well end up being counter-productive in terms of overall contribution / burden to the state.

There is a similar challenge in the case of people that chose BTL, or any other form of savings, rather than pension to provide for their old age.

zagfles

thegentleway said:

A._Badger said:

thegentleway said:

A._Badger said:

thegentleway said:

Malkytheheed said:

If you tax the wealthy to a unpalatable level they will leave. Then what are you left with? A country full of socialists with no money to go around. 

It’s not just the socialists that want to improve tax system. I’m conservative and generally want more capitalism but the hoarding of wealth and inequality needs addressing before it turns to tyranny.

And replace it with the tyranny of the state? Bureaucrats and (inevitably corrupt) politicians apportioning other people's possessions and assets based on what they consider to be fair and equal? No, thank you. Most of the trouble this country is in now is the result of the actions of incompetent politicians. We need less of it, not more. 

I agree with fewer politicians and smaller state but that doesn’t solve inequality. If you let things get too bad then you end up with Trump, etc...

Forgive me if I doubt that you are really a conservative (either with or without a capital C). As for Donald Trump, I'm  not sure what you think he has to do with it - certainly not with the  'inequality' that you are concerned about, for which, in any case, death duties in this country have largely done for in terms of inheritance - ask the National Trust. 

If your concern is with inequality of income, so long as I am comfortable, why should it trouble me if some footballer earns more in a year than I will in a decade?

More than happy to forgive you for the incorrect assumptions you make about me.

In the past, when the aristocracy pushes too far, kings/ruling elite have been beheaded. Keep going with inequality and you threaten the stability of our society.

You completely misunderstand what inequality I'm concerned about. I'm all for people earning more if they add more value.
For clarification: my main concern is inequality of opportunity.

The problem is that many people and pressure groups confuse inequality of outcome with inequality of opportunity. It's as if they believe all children are born with identical abilities and that differences in outcomes can only be a result of differences in opportunities.

Just as tall parents are more likely to have tall children, successful hard working parents are more likely to have successful hard working children, poor parents are more likely to have children who end up poor etc.

Of course there's a lot of debate about the extent of nature vs nurture, and of course children of successful/poor parents may follow the example of their parents as well as genetically inheriting their traits. But some simply deny nature plays any part at all eg when you get when clueless pressure groups using stuff like the socio-economic makeup of students at top universities as proof that there's a lack of opportunity for students from poor backgrounds.

barnstar2077

zagfles said:

thegentleway said:

A._Badger said:

thegentleway said:

A._Badger said:

thegentleway said:

Malkytheheed said:

If you tax the wealthy to a unpalatable level they will leave. Then what are you left with? A country full of socialists with no money to go around. 

It’s not just the socialists that want to improve tax system. I’m conservative and generally want more capitalism but the hoarding of wealth and inequality needs addressing before it turns to tyranny.

And replace it with the tyranny of the state? Bureaucrats and (inevitably corrupt) politicians apportioning other people's possessions and assets based on what they consider to be fair and equal? No, thank you. Most of the trouble this country is in now is the result of the actions of incompetent politicians. We need less of it, not more. 

I agree with fewer politicians and smaller state but that doesn’t solve inequality. If you let things get too bad then you end up with Trump, etc...

Forgive me if I doubt that you are really a conservative (either with or without a capital C). As for Donald Trump, I'm  not sure what you think he has to do with it - certainly not with the  'inequality' that you are concerned about, for which, in any case, death duties in this country have largely done for in terms of inheritance - ask the National Trust. 

If your concern is with inequality of income, so long as I am comfortable, why should it trouble me if some footballer earns more in a year than I will in a decade?

More than happy to forgive you for the incorrect assumptions you make about me.

In the past, when the aristocracy pushes too far, kings/ruling elite have been beheaded. Keep going with inequality and you threaten the stability of our society.

You completely misunderstand what inequality I'm concerned about. I'm all for people earning more if they add more value.
For clarification: my main concern is inequality of opportunity.

The problem is that many people and pressure groups confuse inequality of outcome with inequality of opportunity. It's as if they believe all children are born with identical abilities and that differences in outcomes can only be a result of differences in opportunities.

Just as tall parents are more likely to have tall children, successful hard working parents are more likely to have successful hard working children, poor parents are more likely to have children who end up poor etc.

Of course there's a lot of debate about the extent of nature vs nurture, and of course children of successful/poor parents may follow the example of their parents as well as genetically inheriting their traits. But some simply deny nature plays any part at all eg when you get when clueless pressure groups using stuff like the socio-economic makeup of students at top universities as proof that there's a lack of opportunity for students from poor backgrounds.

I agree.  You are more likely to go to university if your parents did for instance.  Personally though, it was seeing how terrible with money my mum was, and how that had a negative affect on our lives, that made me so good with money.  Although, as a result I find it very hard to enjoy money even when I have it.  

Clive_Woody

Presumably this wealth tax would include tax free savings and investments in it's calculations? 

zagfles

Grumpy_chap said:

thegentleway said:

zagfles said:

thegentleway said:

Black_Cat2 said:

Being taxed on how much your pension is worth seems unfair to me (if I read this correctly?).  We are encouraged to pay what we can into one to support our retirement so how is it then fair to bring in a tax on it now?  DC and DB pensions meant you sacrifice your salary to be entitled to them and take the gamble that your hard earned money may go up as well as down 🤔

I'm the first to admit I've probably missed the point lol, be kind 😘

You can use that argument to make out all taxation is unfair. E.g. I work hard at my job so it’s unfair that the government takes a cut of my income.
This kind of selfish greedy thinking doesn’t consider how to pay for defence, healthcare, infrastructure, etc... that we all benefit from. Without government expenditure you wouldn’t have a job or a pension in the first place. 

No it isn't. The PPs point seems to be that we are encouraged to support ourselves in retirement by paying into a pension, if the government keep changing the goalposts about how they're taxed etc then that's similar to retrospective taxation, and it will cause people to lose faith in pension savings. Nothing at all like whinging about taxes on employment income. If the govt put taxes on employment income up then people can decide eg not to work overtime etc in the future because it's not worth it. Rather than retrospectively getting a bill for extra tax on the overtime they worked in the past.

You’re welcome to your opinion but I think it’s the same logic:
you can’t tax pension coz you discourage people saving for retirement is the same as you can’t tax higher earners more coz you discourage hard work and career progression. It’s the same very weak argument against taxation which you can apply to anything you don’t want taxed.

I don't think it is the same logic.

Anyone can make a decision today on how much work they will choose to do based upon whether it is "worth it" given the level of income tax that will become due today.

Pension assets have been built up based on decisions taken yesterday, so to now apply a "wealth tax" on pensions retrospectively is not the same.  An individual cannot decide to "uncontribute" to their pension now that this tax is a possibility.

Those that do have pension assets have been encouraged to do so by successive Governments as a means to lessen the burden on the tax payer.  If the Government can levy a "one-off" retrospective tax on pension assets then the Government will be able to do that again and again until it becomes the norm.  At this point, future savings into pension funds will diminish and future tax payers will need to provide far higher levels of support to the elderly.  As such, imposing retrospective "wealth" taxes may well end up being counter-productive in terms of overall contribution / burden to the state.

There is a similar challenge in the case of people that chose BTL, or any other form of savings, rather than pension to provide for their old age.

Pensions are different to other investments in that you can't access them until a certain age, for some people this will be decades away. Completely different to other forms of savings where there's no restriction on access.

thegentleway

Grumpy_chap said:

thegentleway said:

zagfles said:

thegentleway said:

Black_Cat2 said:

Being taxed on how much your pension is worth seems unfair to me (if I read this correctly?).  We are encouraged to pay what we can into one to support our retirement so how is it then fair to bring in a tax on it now?  DC and DB pensions meant you sacrifice your salary to be entitled to them and take the gamble that your hard earned money may go up as well as down 🤔

I'm the first to admit I've probably missed the point lol, be kind 😘

You can use that argument to make out all taxation is unfair. E.g. I work hard at my job so it’s unfair that the government takes a cut of my income.
This kind of selfish greedy thinking doesn’t consider how to pay for defence, healthcare, infrastructure, etc... that we all benefit from. Without government expenditure you wouldn’t have a job or a pension in the first place. 

No it isn't. The PPs point seems to be that we are encouraged to support ourselves in retirement by paying into a pension, if the government keep changing the goalposts about how they're taxed etc then that's similar to retrospective taxation, and it will cause people to lose faith in pension savings. Nothing at all like whinging about taxes on employment income. If the govt put taxes on employment income up then people can decide eg not to work overtime etc in the future because it's not worth it. Rather than retrospectively getting a bill for extra tax on the overtime they worked in the past.

You’re welcome to your opinion but I think it’s the same logic:
you can’t tax pension coz you discourage people saving for retirement is the same as you can’t tax higher earners more coz you discourage hard work and career progression. It’s the same very weak argument against taxation which you can apply to anything you don’t want taxed.

I don't think it is the same logic.

Anyone can make a decision today on how much work they will choose to do based upon whether it is "worth it" given the level of income tax that will become due today.

Pension assets have been built up based on decisions taken yesterday, so to now apply a "wealth tax" on pensions retrospectively is not the same.  An individual cannot decide to "uncontribute" to their pension now that this tax is a possibility.

Those that do have pension assets have been encouraged to do so by successive Governments as a means to lessen the burden on the tax payer.  If the Government can levy a "one-off" retrospective tax on pension assets then the Government will be able to do that again and again until it becomes the norm.  At this point, future savings into pension funds will diminish and future tax payers will need to provide far higher levels of support to the elderly.  As such, imposing retrospective "wealth" taxes may well end up being counter-productive in terms of overall contribution / burden to the state.

There is a similar challenge in the case of people that chose BTL, or any other form of savings, rather than pension to provide for their old age.

I think the confusion is because you seem to think the pension would be taxed directly? The proposal is to include pensions for the wealth threshold calculations, not tax them directly (I would not be in favour of this either).

kinger101

thegentleway said:

Grumpy_chap said:

thegentleway said:

zagfles said:

thegentleway said:

Black_Cat2 said:

Being taxed on how much your pension is worth seems unfair to me (if I read this correctly?).  We are encouraged to pay what we can into one to support our retirement so how is it then fair to bring in a tax on it now?  DC and DB pensions meant you sacrifice your salary to be entitled to them and take the gamble that your hard earned money may go up as well as down 🤔

I'm the first to admit I've probably missed the point lol, be kind 😘

You can use that argument to make out all taxation is unfair. E.g. I work hard at my job so it’s unfair that the government takes a cut of my income.
This kind of selfish greedy thinking doesn’t consider how to pay for defence, healthcare, infrastructure, etc... that we all benefit from. Without government expenditure you wouldn’t have a job or a pension in the first place. 

No it isn't. The PPs point seems to be that we are encouraged to support ourselves in retirement by paying into a pension, if the government keep changing the goalposts about how they're taxed etc then that's similar to retrospective taxation, and it will cause people to lose faith in pension savings. Nothing at all like whinging about taxes on employment income. If the govt put taxes on employment income up then people can decide eg not to work overtime etc in the future because it's not worth it. Rather than retrospectively getting a bill for extra tax on the overtime they worked in the past.

You’re welcome to your opinion but I think it’s the same logic:
you can’t tax pension coz you discourage people saving for retirement is the same as you can’t tax higher earners more coz you discourage hard work and career progression. It’s the same very weak argument against taxation which you can apply to anything you don’t want taxed.

I don't think it is the same logic.

Anyone can make a decision today on how much work they will choose to do based upon whether it is "worth it" given the level of income tax that will become due today.

Pension assets have been built up based on decisions taken yesterday, so to now apply a "wealth tax" on pensions retrospectively is not the same.  An individual cannot decide to "uncontribute" to their pension now that this tax is a possibility.

Those that do have pension assets have been encouraged to do so by successive Governments as a means to lessen the burden on the tax payer.  If the Government can levy a "one-off" retrospective tax on pension assets then the Government will be able to do that again and again until it becomes the norm.  At this point, future savings into pension funds will diminish and future tax payers will need to provide far higher levels of support to the elderly.  As such, imposing retrospective "wealth" taxes may well end up being counter-productive in terms of overall contribution / burden to the state.

There is a similar challenge in the case of people that chose BTL, or any other form of savings, rather than pension to provide for their old age.

I think the confusion is because you seem to think the pension would be taxed directly? The proposal is to include pensions for the wealth threshold calculations, not tax them directly (I would not be in favour of this either).

If they form part of assets over £1m, then they are taxed directly.  By definition, a wealth tax is a direct tax in that they are levied on the bearer and paid directly to the government.