Tax crackdown on rich announced by Danny Alexander

[Hackney]

garyhun said:

Hackney said:

I don't know whether to laugh or cry at this thread.

It may be posturing.
But making sure that people who can most afford to pay the tax they're due to pay is surely a good thing. Is it OK for rich people to get away with any other crime?
"Yes I do the odd bit of burglary, but I live in a £1m house. Why are you persecuting me when there are poor criminals around?"

Alain de Botton said this morning that "paying tax should be framed as a glorious civic duty worthy of gratitude - not a punishment for making money"

In that sense, a "crackdown" isn't the word to use. But why do "the rich" on the whole want to avoid doing what they can afford to pay?

So if your property increased in value over 20 years to say, £1m, but you are on a salary of, say £40K, you are rich? Madness.

If I'm paying the tax I should be I've nothing to hide. So why should it matter if I'm classed as rich should that situation arise?

The LibDems would need to clarify who they're targeting, clearly. The person whose property increased in price versus the person who bought a £1m property.

[turbobloke]

Hackney said:

If I'm paying the tax I should be I've nothing to hide.

Good point. Your earlier criticism used the words 'avoiding the tax due'.

That's completely different from the other words you used which were 'can afford to pay'.

Anybody with disposable income or savings could 'afford' to pay more tax. But why should they if they already pay what they should and are lawfully avoiding paying more?

Your earlier argument was based on what could be afforded, rather than what the law states. If the approach is based on what can be afforded by the rich rather than what tax laws say, then there are significant problems over who decides what 'rich' means and who decides what they can afford.

This in my view is why people are questioning your approach. It's not because of any wish to prevent lawfully due taxes being paid or lawful tax avoidance for that matter. It's because of the woolly and frankly dangerous 'what they can afford' criterion, and the desire of incompetent politicians to set more and more taxes while wasting more and more money while not cutting their excessive spending - in order to remove the need to take so much tax.

Edited for a typo or two

Edited by turbobloke on Sunday 23 September 09:59

[Hackney]

turbobloke said:

The law is in place on taxes, including property taxes. It can and should be enforced equally. Is putting an extra squeeze on one group which is seen to be successful a sign of some new definition of equal treatment?

How much mediocrity and dependence is enough for Libdim politicians?

Absolutely agree, however, "the rich" have most to gain and most opportunity for avoiding taxes.
Starting at the very, very top with the likes of Kraft, Philip Green etc etc.

A line has to be drawn somewhere, or a start point defined. I'm not saying the LibDems have got it right, but a level must be decided where we start to chase people for the tax they should be paying. Saying, it's not fair to target people who got lucky with the property boom, or it shouldn't be me.

Just heard on the news they're targeting "the richest 10%" so that's hardly going to be people who bought a £700k house which is now worth £1m is it?

[turbobloke]

Hackney said:

Just heard on the news they're targeting "the richest 10%" so that's hardly going to be people who bought a £700k house which is now worth £1m is it?

Apparently, it is. That is, if the beeb have got something right for once.

BBC article covering the Alexander Inquisition said:

Individuals with assets of more than £1m face a new crackdown on tax avoidance, Lib Dem Treasury Chief Secretary Danny Alexander has revealed.

Previously, the unit only scrutinised the tax affairs of people with assets and property of more than £2.5m.

Danny Boy's attention should be focusing on getting the private sector wealth creation machine up to steam, while cutting back on excess government spending including aid wasted on rich nations.

The beeb article is somewhat nonsensical however, as tax avoidance is lawful so there is nothing that can be done to crack down on it. Tax laws can be changed, but avoiding paying more than the minimum tax due under the new regime will still be tax avoidance and it will still be lawful.

[Halb]

They just played that youtube video in front of him, that was funny.

[rover 623gsi]

'The rich' is being defined as people with property and assets worth over £1 million - this totals around 500,000 people. These people will come under extra scrutiny to make sure they are not cheating the taxman. So, it's not actually a tax on owning an expensive house, it's just saying that if you have an expensive pad the govt is going to check your tax affairs to make sure you're not taking piss.

I don't see the problem.

[turbobloke]

rover 623gsi said:

I don't see the problem.

Presumably you've never been an innocent taxpayer with the revenue on your back? If you have been in that situation your memory is failing.

Anybody posting that it's cushty and hunky dory is posting from ignorance. The price innocent people pay (not just the taxes) to the revenue is grotesque already.

[chris watton]

rover 623gsi said:

'The rich' is being defined as people with property and assets worth over £1 million - this totals around 500,000 people. These people will come under extra scrutiny to make sure they are not cheating the taxman. So, it's not actually a tax on owning an expensive house, it's just saying that if you have an expensive pad the govt is going to check your tax affairs to make sure you're not taking piss.

I don't see the problem.

It wouldn't stop there though, would it? Once something like this is in place, new legislation creeps in on top, until those earning perhaps £50k are considered 'super rich' (MP's are always excluded, of course..)

[rover 623gsi]

Well, I supose if you're going to put extra resources into something you want to ensure that those extra resources are targeted to ensure they have the most impact.

[turbobloke]

chris watton said:

It wouldn't stop there though, would it? Once something like this is in place, new legislation creeps in on top, until those earning perhaps £50k are considered 'super rich' (MP's are always excluded, of course..)

Quite right! £50k is nearly twice the national median income!! Tax the rich bds, soak them all until none remain solvent or alive!!!

Another post on PH some time ago said:

From 2013-14 when the additional rate drops to 45%:

A person earning £15,000 will pay £2,048 in tax and NI (14% of their income)

A person earning £25,000 will pay £5,247 in tax and NI (21% of their income)

A person earning £50,000 will pay £14,102 in tax and NI (28% of their income)

A person earning £80,000 will pay £26,703 in tax and NI (33% of their income)

A person earning £120,000 will pay £47,185 in tax and NI (39% of their income)

A person earning £150,000 will pay £59,785 in tax and NI (40% of their income)

A person earning £300,000 will pay £130,285 in tax and NI (43% of their income)

So people who earn £300k might earn twenty times that of those who earn £15k, but they pay SIXTY-FOUR times as much tax

The marginal rate of tax for high earners is currently 58% iirc.

WTF sort of mess has any government got into to take more than half of any additional income from anybody?

[Phil1]

Hackney said:

Absolutely agree, however, "the rich" have most to gain and most opportunity for avoiding taxes.
Starting at the very, very top with the likes of Kraft, Philip Green etc etc.

A line has to be drawn somewhere, or a start point defined. I'm not saying the LibDems have got it right, but a level must be decided where we start to chase people for the tax they should be paying. Saying, it's not fair to target people who got lucky with the property boom, or it shouldn't be me.

Just heard on the news they're targeting "the richest 10%" so that's hardly going to be people who bought a £700k house which is now worth £1m is it?

A quick Google gives £45k income or above in the top 10% by earnings. An article from the Guardian in 2010 says £853,000 by household wealth is the start of top 10%.

[turbobloke]

rover 623gsi said:

Well, I supose if you're going to put extra resources into something you want to ensure that those extra resources are targeted to ensure they have the most impact.

How many failed businesses and how much ill health would you sanction for this impact on innocent people? Which impact is most effective?

Better that ten guilty men walk free than one innocent man is...hold on, this is the revenue. Shoot to kill, ask questions later.

With HMRC you are guilty until you prove your innocence i.e justice turned upside down.

[anonymous-user]

rover 623gsi said:

'The rich' is being defined as people with property and assets worth over £1 million - this totals around 500,000 people. These people will come under extra scrutiny to make sure they are not cheating the taxman. So, it's not actually a tax on owning an expensive house, it's just saying that if you have an expensive pad the govt is going to check your tax affairs to make sure you're not taking piss.

I don't see the problem.

One presumes that you don't come into the affected bracket?

For me this is just the last, desperate bleatings of a failed political party.

What purpose will the Libdems serve at the next election? They will be crucified and as there is now another 'protest vote' party in UKIP, there is absolutely one need for the Libdems.

[rover 623gsi]

and despite that, most people would rather earn £300k a year than £15k a year

[speedy_thrills]

Hackney said:

If I'm paying the tax I should be I've nothing to hide.

How big is Tolley's Yellow Tax Handbook now, 14k+ pages? People have built whole careers understanding just certain aspects of the tax code.

It needs to be complex of course but my point is can you ever really be sure you have nothing to hide? I enjoy a good audit as much as the next sadist of course.

[markcoznottz]

Halb said:

Clegg is on Marr now, talking about this.

Pass me a bucket. Two useless fking drains of public money. You don't need a tt like marr asking questions you could read what clegg says online in 5 mins. There. That's saved marrs £600 k salary. Asking questions on a sofa, the best part is we fking pay for it!. Tax revenues are obviously tanking, this will piss of the very people who start most businesses in this country. How about setting out how to cut costs and start growth cleggy? Hmm too hard that one lets revert to some Marxist nonsense.

[turbobloke]

rover 623gsi said:

and despite that, most people would rather earn £300k a year than £15k a year

A piece of self-evident hoary old doggerel that makes no difference to anything.

Besides, not all can earn £300k though - and when somebody's life turns out worse than they would have liked often through their own bad decisions, who's to blame? The rich! Whoever they are. Bash the rich!

The effect (whatever the intention) of the libdim Alexander Inquisition is to reinforce a myth that 'rich' people earning £50k and sitting in an inherited house worth £1m are evading gazillions in tax.

It's bullst. This 'crackdown' will raise peanuts.

[rover 623gsi]

The point is that most people would rather have 50% of £300k than 95% of £15k. If you're earning £300k a year, even with paying higher tax, you're still taking home a st load of money.

Edited by rover 623gsi on Sunday 23 September 10:32

[turbobloke]

rover 623gsi said:

The point is that most people would have 50% of £300k than 95% of £15k. If you're earning £300k a year, even with paying higher tax, you're still taking home a st load of money.

And so you should, given you are already paying 64 times more tax, as per the example you refer to.

Meanwhile incompetent thieving politicians can keep their grubby mits off already-taxed income and related acquired wealth. At least, they should keep off in terms of the already excessive st load of tax and duties they take.

You seem to be straying back into 'the rich can afford it' territory.

Presumably you or somebody like you will appropriate the right to decide who is 'rich' and what exactly is affordable in terms of 'the rich can afford it'?

[rover 623gsi]

REALIST123 said:

One presumes that you don't come into the affected bracket?

For me this is just the last, desperate bleatings of a failed political party.

What purpose will the Libdems serve at the next election? They will be crucified and as there is now another 'protest vote' party in UKIP, there is absolutely one need for the Libdems.

no, i'm most certainly not in the affected bracket - but I'm not sure it's good to judge the success, or failure, of every political decision simply on how it affects me individually. Not long after the coalition got in, we lost the £40 a month Working Tax Credit we used to get - that was a bit of a bummer, but in all honesty, we didn't really need it and I think the WTC and it's counterpart, the Child Tax Credit, has never worked efficiently or effectively.