Income Tax: Do you agree with the Govt’s changes? Poll results/discussion

JayWalker

As other people have commented in this thread, the changes in tax credits do NOT compensate everyone on a low income.

Simple economics: if the Government gives more money to someone (in this case, the better off) then the money has to come from somewhere else. Since they haven't had any major windfalls, then the money is coming from those people who will be paying more tax.

The crime is that this set of changes is impacting certain types of lower-income households, and that the disabled community / people with health problems are over-represented in this group.

kitty1801 wrote: »

The reason the compensation is expected to be for those under 25 and pensioners between 60 - 64 is because all others will be covered under the enhanced tax credits available ( you don't have to have children to claim tax credits but you do need to be over 25 and working)

noahveil

kitty1801 wrote: »

The reason the compensation is expected to be for those under 25 and pensioners between 60 - 64 is because all others will be covered under the enhanced tax credits available ( you don't have to have children to claim tax credits but you do need to be over 25 and working)

So, not all others will be covered.

What about the many many thousands (for a variety of reasons) of early retirees under age 60 who cannot claim under the (even "enhanced") tax (dis)credits system ??

Vlasko

Another_Ian wrote: »

First post sorry if it goes wrong.

I recently wrote to my labour MP, a Government minister, to point out the fact that the Government 10% tax change meant that someone earning £7665 pa was giving £230 to a person earning £30500 and someone on the minimum wage was giving some £163 to a person earning £27000. I also pointed out that it now took 2.8 people on minimum wage to pay for an MP’s tax gain of £450.

The reply was a masterpiece of politician speak I quote 2 examples:-

1). Politician : ‘Unlike the tax credit the tax rate is not a targeted tax measure: all tax payers benefit from it including higher earners such as those on £100,000 a year, who would still only pay 10p in the pound on the first £2230 of their taxable income.’

Meaning: To make the system fairer we will take an additional £230 pa from the person on £7625 to contribute to the extra £450 we now give to that person on £100,000.

2). Politician: ‘For those not eligible for tax credits

---

the reforms to the tax and benefits system since 1997 mean that those individuals will still be £495 a year better off by April 2009’

Meaning: Last year ‘those individuals’, were £725 better off since 1997 and were 46% better off last year compared to now.

The above are my sums and my interpretation – perhaps a politician would care to comment.

Funny, how you describe it: Poor give to the rich. Do you know how the tax system actually works ? All the people pay the taxes sa that the politicians can spend it. That is about it. Poor do not give anything to the rich. Have you ever calculated how much does a person earning 40000£ pays on taxes compared to 15000£? Is it fair that the do not pay the same ? Do rich get more from the public services than poor? I do not think so. Or are you just envious that the earn more than you => steal everything from them.

nogdude

Makes me laugh with all the hoo haa going on about this 'now'.

This was anounced last February (2007) and its taken all the MPs over a year to say anything or take proper action on this.

If they had acted like this last year as they are now, then probably this may not have become legislation this year.

So what has happened; have the MPs woken up and thought oh my god, payrise time has come around, lets look like we are doing something for our money, or were they all waiting in the aisles to stab Brown in the back.

Either way, sack the lot of them and get some real down to earth people in there doing the job, who can make decisions for the people and for our country.

arefem

:eek: This government has become complacent. After so long in power, they feel invulnerable. It happened with the Tories, now Labour are following suit. All our major politicians, of all parties, are concerned about is feathering thier own nest and protecting thier own pensions. Dropping the 10% tax band is just another ploy to re-invent the working classes.
The announcement of more 'Tax Credits' is another con. Why should we have to justify having our money returned to us? And given the fiasco over other government schemes to 'support' the less well off, why should we think this one will be any better managed.
Some years ago, trilaterialist Henry Kissinger said (I paraphrase), "Control Oil and you control nations, control food and you control the people". We are now seeing this come to fruition with rapidly increasing food and fuel prices, and now the reduction in income by the removal of the 10% tax band. Somehow I feel there is worse to come.

Stephenbw

kitty1801 wrote: »

The reason the compensation is expected to be for those under 25 and pensioners between 60 - 64 is because all others will be covered under the enhanced tax credits available ( you don't have to have children to claim tax credits but you do need to be over 25 and working)

Unfortunately they won't.

As I am under 60 and living off my occupational pension after being made redundant I cannot claim tax credits.

UltraViolet68

podiluska wrote: »

£3500 in petrol. So about £300 per month. That's 60 gallons - so if you had a reasonably economical car, say 40mpg, you're could be driving 2400 miles a month - or 120 miles a day - 60 miles each way. Have you considered moving or changing your car?

I am in this situation also and would love to live closer to work, however my work is such that you tend to move on after 3 or 4 years, so I would have the stamp duty tax to pay every 3 years or so. Given my current job is in an area with little other employment, chances are my next job would be in the other direction from where I would have to move to reduce my current journey.
I drive an economical car, use cruise control to keep speed from creeping up and I drive smoothly avoiding harsh acceleration and heavy braking so I average circa 50 miles per gallon but it still costs me over £60 a week which is a fair bit above what I was paying when I joined this company less than 2 years ago.
Moving or changing cars isn't always an available solution sadly.
Considering so many taxes are supposed to be motivated by green issues, stamp duty not keeping pace with average house prices certainly is not green.

Anyway - tax rate.....

I would love to have a much simpler tax system which also reduces the admin involved in collecting the very many types. This has IMO been mishandled, rather than reduce the 22p rate, the amount you can earn before you pay tax should have been increased. This could have been done to ensure no-one was disadvantaged by the removal of the 10p rate, but also it is IMO the fairest way to reduce direct taxation - everyone benefits, but the less well off benefit more proportionatly.
Tax credits are not an answer IMO as they introduce more admin and rely on people claiming them.

I would be happy if the standard rate was 25p but some indirect taxes were dropped - such as the tax on gas/electricity, tax on insurance premiums.

Additionally I would enable charities to be able to claim back the tax they pay on fuel. I donated a sofa and chair recently and was shocked to hear that even though they never turn a donation down, sometimes the cost of collection is more than they then can sell the goods for - they are being hit hard by the duty on fuel.

Obviously the fuel duty also hits everyone on food prices, but the poor are hit disproportionatly.

UltraViolet68

Vlasko wrote: »

Funny, how you describe it: Poor give to the rich. Do you know how the tax system actually works ? All the people pay the taxes sa that the politicians can spend it. That is about it. Poor do not give anything to the rich. Have you ever calculated how much does a person earning 40000£ pays on taxes compared to 15000£? Is it fair that the do not pay the same ? Do rich get more from the public services than poor? I do not think so. Or are you just envious that the earn more than you => steal everything from them.

I know how much someone earning considerably more than £40k per year pays in tax, I am one of the winners in these changes, however I stand by what I believe - yes it is fair that I pay more than someone earning just £15k a year. I do not get much at all from public services (no kids, good health, own home/transport), but simple direct taxation means less waste on cost of collection and IMO fair. We are all winners if the children of the country get a good education.

Taking your argument to the far extream would be to suggest the fairest way would be to have no free services and pay for what we use. That would be a IMO nasty society - 'dog eat dog' and 'I'm all right Jack' with the have nots being driven to drastic measures if they needed medical attention, fly-tipping becoming common etc.

Yes, for me it is nice for me that my salary will have a little less tax taken from it this month, but no, I do not like that to fund it, lower paid and pensioners have to pay more tax. Def. wrong.

Incidentally, the effect of the changes are the same whether you earn £45k or £245k ..... you will be £297 a year better off when you take the NI into consideration as well as the tax. £24.75 a month .... a couple of nice bottles of wine for me, but perhaps a whole week food shopping for the low paid single or the pensioner between 60 and 64.

tamara111

really they should just keep it simple!!
Raise everyones personnal allowances to 12-15k 20% on all the rest and scrap all these silly systems working families credits etc these probally cost more to administer than they pay out anyway, no idea how much this would cost the economy fancy some maths? ps I would pay the idle to sit around at home either although the disabled and elderly should always be given a fair and decent living income

shropshirelady

So they're going to compensate pensioners (60-64) by upping the fuel allowance. I bet we won't be receiving as much as we will be losing in tax and it won't be paid until Nov/Dec. In the meantime we struggle on with rising bills.

I'm a single pensioner too without children; fortunately still working part-time. I've worked non-stop since leaving school at 15 with very little sickness benefit or unemployment benefit in all those years. I have a small company pension so can't claim pension credits.

I wrote to the government to say that if they stopped the super-rich from taking their money out of the country to avoid tax and got rid of all the people who have to work out (often wrongly) all the different tax credits etc, they could pay us all a decent pension and lower taxes. I did not get a reply though. I suppose that, if they dispensed with all those people, the unemployment rate would rocket.