40p Tax band - history
Discussion
Johnnytheboy said:
cerbfan said:
But just going into the 40% tax bracket is not a massive loss is it? Just means that the few hundred quid that is above the threshold of 40% instead of the previous rate. I'd swear that a lot of people think that once you go above the threshold you pay 40% on your whole salary the way its bleated on about.
That's one of those things that doesn't get mentioned isn't it? The way it's reported, if you're a few pence into the 40% bracket you pay 40% on the lot.simoid said:
Odie said:
And again someone needs to explain to the chancellor how a percentage works... This countries tax system pisses me off.
Everyone should be on the same income tax %
Serious? Everyone should be on the same income tax %
"The danger of disproportional taxes was already apparent in that they could be voted by those who would not have to pay them and on a scale to which there was no defined limit".
Democracy and proportinate taxation work very well together - if we all paid the same proportion of our income in tax, we'd all have the same vested interest in keeping public spending down.
I agree with you on the risks and the vested interest, but I fail to see how you can't see the moral case.
Paddy_N_Murphy said:
simoid said:
Really?
Money is worth more to people who have less of it.
I do thing you are being slightly misaligned here.Money is worth more to people who have less of it.
We all go out to work to supposedly earn Our wages.
Whether you earn 10,000 or 25,000 or 150,000, you go to earn Your Money - agree?
Or do you get upin the morning and thing, Yippee, I am off to earn me some money and hope to earn as much as I can for HMRC too !
No - I don't think you do, do you.
<top of head numbers follow bare with me>
So, lets take this to the reverse of what you are saying-
Is it easier for the Man making 10,000 to hand over £1,000 to HMRC, or is it easier for the man who has gone to work thinking he is earning for himself £125,000 to hand over to HMRC £60,000.
Let me say that again - do you think it hurts LESS to hand over to HMRC £60,000 or £1,000 of Your Earnings. Essentially the reason you go to work.
Numbers may be f
ked, theory is right.Paddy_N_Murphy said:
Is it easier for the Man making 10,000 to hand over £1,000 to HMRC, or is it easier for the man who has gone to work thinking he is earning for himself £125,000 to hand over to HMRC £60,000.
One goes home with £9k and the other with £65K. I would expect the latter to be more satisfied about his lot. But I guess some people are just the glass half empty sorts.http://en.wikipedia.org/wiki/Progressive_tax#For_i...
Read, digest, understand that having a flat tax rate is unfair, because £1 to a pauper is more valuable than £1 to a millionaire.
Diminishing marginal utility.
Read, digest, understand that having a flat tax rate is unfair, because £1 to a pauper is more valuable than £1 to a millionaire.
Diminishing marginal utility.
Paddy_N_Murphy said:
Ben - why do you go to work ?
To earn money for yourself ?
or for HMRC / the country.
That's not a question that's as simple to answer as you'd like.To earn money for yourself ?
or for HMRC / the country.
The balance between getting enough of your increased wage to want to earn it vs taking enough tax to cover the country's expenses is what it's all about.
Do you see people refusing pay rises because it's not worth it?
When you get to the kind of salaries that start to skew your tax contributions in the way you're complaining about it's not about the money, it's about self actualisation. The money is just a way of measuring it.
Paddy_N_Murphy said:
Randy Winkman said:
One goes home with £9k and the other with £65K. I would expect the latter to be more satisfied about his lot. But I guess some people are just the glass half empty sorts.
I agree - the take home 65k would be happy - but I am sick of everyone saying that tax the higher earners a greater percent.Percents are all very well, but the net effect is giving nigh on half your working wage away.
Before you assume I'm some kind of benefit scrounger, I'll tell you I'm a higher rate tax payer who works in the financial services industry, and that I have no problem with the amount of tax that I pay. Where it's spent, that might be another matter, but I understand that the country needs funding and I'm happy to take the burden that I'm asked to by my country.
The tax system should be taken a couple of steps further.
In round figures:
Everyone (yes every adult) gets 10,000 a year from the government.
Everyone pays 33% income tax on all earnings.
(Hence on 30,000 the net result is you pay the 10,000 back as tax)
All capital and assets, business personal etc etc (including homes) are deemed to return 6% a year, and tax at 33% is due on this - hence about 2% a year - a form of wealth tax. (Note this tax would only be on equity in a home, the mortgage lender pays the rest)
VAT and other duties can stay the same.
Result, simplicity and removal of considerable amounts of bullst.
In round figures:
Everyone (yes every adult) gets 10,000 a year from the government.
Everyone pays 33% income tax on all earnings.
(Hence on 30,000 the net result is you pay the 10,000 back as tax)
All capital and assets, business personal etc etc (including homes) are deemed to return 6% a year, and tax at 33% is due on this - hence about 2% a year - a form of wealth tax. (Note this tax would only be on equity in a home, the mortgage lender pays the rest)
VAT and other duties can stay the same.
Result, simplicity and removal of considerable amounts of bulls
t.Paddy_N_Murphy said:
simoid said:
Someone grossing £125k will pay £43k income tax, and around £5k NI, incidentally.
I knew my numbers were all made up - not that outta drift however....
simoid said:
http://en.wikipedia.org/wiki/Progressive_tax#For_i...
Read, digest, understand that having a flat tax rate is unfair, because £1 to a pauper is more valuable than £1 to a millionaire.
Diminishing marginal utility.
did you not scroll down on that page???Read, digest, understand that having a flat tax rate is unfair, because £1 to a pauper is more valuable than £1 to a millionaire.
Diminishing marginal utility.
progressive taxation is unfair...imho (you stated your opinion as a bare fact)
you also fail to consider the scale of someone's wealth isn't entirely accidental
pork911 said:
simoid said:
http://en.wikipedia.org/wiki/Progressive_tax#For_i...
Read, digest, understand that having a flat tax rate is unfair, because £1 to a pauper is more valuable than £1 to a millionaire.
Diminishing marginal utility.
did you not scroll down on that page???Read, digest, understand that having a flat tax rate is unfair, because £1 to a pauper is more valuable than £1 to a millionaire.
Diminishing marginal utility.
progressive taxation is unfair...imho (you stated your opinion as a bare fact)
you also fail to consider the scale of someone's wealth isn't entirely accidental
You cannot possibly suggest taxing someone 10% for someone on £100 per week, and 10% for someone else on £100,000, is fair.
simoid said:
Paddy_N_Murphy said:
Percents are all very well, but the net effect is giving nigh on half your working wage away.
Someone grossing £125k will pay £43k income tax, and around £5k NI, incidentally.simoid said:
pork911 said:
simoid said:
http://en.wikipedia.org/wiki/Progressive_tax#For_i...
Read, digest, understand that having a flat tax rate is unfair, because £1 to a pauper is more valuable than £1 to a millionaire.
Diminishing marginal utility.
did you not scroll down on that page???Read, digest, understand that having a flat tax rate is unfair, because £1 to a pauper is more valuable than £1 to a millionaire.
Diminishing marginal utility.
progressive taxation is unfair...imho (you stated your opinion as a bare fact)
you also fail to consider the scale of someone's wealth isn't entirely accidental
You cannot possibly suggest taxing someone 10% for someone on £100 per week, and 10% for someone else on £100,000, is fair.
it neither is or isnt
JDRoest said:
simoid said:
Paddy_N_Murphy said:
Percents are all very well, but the net effect is giving nigh on half your working wage away.
Someone grossing £125k will pay £43k income tax, and around £5k NI, incidentally.swerni said:
simoid said:
http://en.wikipedia.org/wiki/Progressive_tax#For_i...
Read, digest, understand that having a flat tax rate is unfair, because £1 to a pauper is more valuable than £1 to a millionaire.
Diminishing marginal utility.
So If it's more valuable to be poor person.Read, digest, understand that having a flat tax rate is unfair, because £1 to a pauper is more valuable than £1 to a millionaire.
Diminishing marginal utility.
Therefore has greater value.
Shouldn't we be pushing for higher taxes on things of higher value?
rover 623gsi said:
However, increasing numbers of positions are part-time. We are moving ever forwards to an hourglass economy, with the ‘middle class’ having to either become very successful or risk losing everything. There are fewer jobs in the middle ranking roles so the mid-point is going to keep falling.
And largely that's been reflected in the skew of income distribution over time. However I've seen little effort yet to address that fundamental underlying issue of income mobility in western countries.There is an interesting article in the Telegraph about how Estonia and Sweden dug themselves out after the financial crash by being bold on tax policy [the tiny adjustments that Osborne will make are just too small to change spending and consumption behaviour]
It involved significant tax cuts - particularly to the lower paid and business ..driving more spend and consumption and increasing employment IIRC .. creating a virtuous circle of more spend -> jobs -> spend -> recovery which eventually increased tax revenues after tax rates had been cut.
One related issue the UK is now facing is that savings rates as a % of earnings have massively increased as people are frightened of spending money ... this in turn hampers the recovery.
Also - perhaps if the minimum wage were reduced along with tax cuts there would be more jobs.
It involved significant tax cuts - particularly to the lower paid and business ..driving more spend and consumption and increasing employment IIRC .. creating a virtuous circle of more spend -> jobs -> spend -> recovery which eventually increased tax revenues after tax rates had been cut.
One related issue the UK is now facing is that savings rates as a % of earnings have massively increased as people are frightened of spending money ... this in turn hampers the recovery.
Also - perhaps if the minimum wage were reduced along with tax cuts there would be more jobs.
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