Why the UKIP will never work....
Discussion
Mr Whippy said:
A flat rate doesn't do any good if you have a tax free allowance, because where that bracket starts you suddenly get shafted.
Why are you 'getting shafted'?Mr Whippy said:
Brackets are the stupid thing that make a flat rate silly.
Repeating the same nonsense without explanation doesn't help your case.Mr Whippy said:
We see brackets being the bane of the whole benefits system where people fit perfectly into certain zones of best outcome for example.
Or house prices sitting under stamp duty brackets.
stamp duty works entirely differently and is ridiculous.Or house prices sitting under stamp duty brackets.
Mr Whippy said:
If you're gonna have a tax free allowance, then a ramping rate makes more sense.
No it doesn't.Mr Whippy said:
And it's not that complicated, it's a polynomial with stops. Throw in gross, out comes net. It's actually a simpler calculation than bracketed varieties where you need to apply each chunk a different percentage in multiple separate functions.
No it isn't. As explained, every pound earned would be charged a different tax rate!Mr Whippy said:
And yes the rich should pay more tax than people earning less. If you didn't believe in the tax free allowance then that is what IS happening. It's just blending it out with a curved balance.
And they would do under any of the systems under discussion - not sure what your point is?Mr Whippy said:
What curve you choose is up to you but that curve is required to make it fair IF you're gonna have a tax free allowance.
Dave
Don't be silly.Dave
CamMoreRon said:
Given that the tax-free allowance is increasing by a small amount, low earners will only save a small amount of money.
What has that got to do with my comments about a system with a LARGE tax free allowance?Clue: Nothing!!
CamMoreRon said:
Given that the tax rate for high earners would be dropping by a fairly substantial percentage, they would save a significant amount of money. 5 figures, easily, for most.
As explained to you before, those who pay the most have the most to gain from tax reductions. That doesn't mean that everyone else doesn't benefit too.CamMoreRon said:
So you're trying to bulls
t people in to thinking high earners will be making a sacrifice to low earners, when actually they stand to save a very large amount on their tax bills.
High earners already make a massive sacrifice to low earners and would continue to do so. The lowest earners would still be better off, despite what you might claim.t people in to thinking high earners will be making a sacrifice to low earners, when actually they stand to save a very large amount on their tax bills. CamMoreRon said:
Furthermore, those who will be below the new threshold still won't be making a living wage (and will therefore still require state subsidy) whereas high earners are making gains on already disposable income.
And yet you want to support a system which requires that the lowest paid earning minimum wage are forced to pay tax.....
CamMoreRon said:
And you have the audacity to try and deny your greed with my envy..
I pay more than my fair share and voluntarily support those that need further help. I think your envy vastly outweighs and perceived greed on my behalf.sidicks said:
No, people up to £45k would be better off (in some cases much better off), so the burden is shifted to those on £45k plus.
There simply aren't enough of them to meet the tax requirements.
£30k is about the cut off for 75% of workers.
£45k is about the cut off for 90% of workers
Not sure why you say there isn't enough of them when the top 10% already pay 90% of income tax? And (as I think you said) a flat rate tax would encourage more compliance so the people most benefiting from evasion/avoidance will probably pay more tax...won't they? There simply aren't enough of them to meet the tax requirements.
£30k is about the cut off for 75% of workers.
£45k is about the cut off for 90% of workers
sidicks said:
"Hard working families" - are you Ed Milliband in disguise?{/quote] 
sidicks said:
As explained previously, a simple and fair tax system makes it harder for high earners to avoid and gives them less reason to do so i.e. You increase the number contributing and generate higher taxes, even with lower take rates.
Which is fine. But the "simplicity" of the system doesn't vary depending on the rate of tax. With regards to "fair", there is no such thing as a fair tax. All taxes are unfair to varying degrees.sidicks said:
Mr Whippy said:
A flat rate doesn't do any good if you have a tax free allowance, because where that bracket starts you suddenly get shafted.
Why are you 'getting shafted'?Mr Whippy said:
Brackets are the stupid thing that make a flat rate silly.
Repeating the same nonsense without explanation doesn't help your case.Mr Whippy said:
We see brackets being the bane of the whole benefits system where people fit perfectly into certain zones of best outcome for example.
Or house prices sitting under stamp duty brackets.
stamp duty works entirely differently and is ridiculous.Or house prices sitting under stamp duty brackets.
Mr Whippy said:
If you're gonna have a tax free allowance, then a ramping rate makes more sense.
No it doesn't.Mr Whippy said:
And it's not that complicated, it's a polynomial with stops. Throw in gross, out comes net. It's actually a simpler calculation than bracketed varieties where you need to apply each chunk a different percentage in multiple separate functions.
No it isn't. As explained, every pound earned would be charged a different tax rate!Mr Whippy said:
And yes the rich should pay more tax than people earning less. If you didn't believe in the tax free allowance then that is what IS happening. It's just blending it out with a curved balance.
And they would do under any of the systems under discussion - not sure what your point is?Mr Whippy said:
What curve you choose is up to you but that curve is required to make it fair IF you're gonna have a tax free allowance.
Dave
Don't be silly.Dave
The work/reward ratio suddenly changes. I've spoken to lots of people who don't bother earning more because of benefit/tax bracket X or Y, "so whats the point"
If you have a tax free allowance, then again suddenly the work/reward ratio changes and may influence behaviours. We know it does. If you are significantly worse off for investing extra effort, then it de-motivates.
The current basic rate is quite low, but to go from tax free earnings at ~ £10,000 to around 30% tax flat rate would mean a huge rise in the number of people just earning around £10,000... and not bothering to work that extra day or two a week in their job just so they could pay a huge chunk of it in tax.
A ramping rate means there is no optimal point to choose, because the brackets are blended away.
What is so hard about paying tax differently on every pound earned? Why is that concept so difficult to grasp?
It's a simple function. Earn more, pay increasingly more tax. We do it already, but at a very granular level. All I'm saying is increase the granularity to remove the influence of the brackets.
Given the modern world we live in with computers and calculators, these calculations are trivial and irrelevant.
No, rich people should pay a higher proportion of their earnings as tax, vs poor people.
They currently do already too. Under the current system.
But adding more brackets will make it fairer for everyone, from very poor to very wealthy.
Cripes, the ramp rate doesn't even have to be that steep... but having ZERO tax at under £10k to a sudden 31% flat rate is just cretinous.
Either do it completely flat at 31% from 0 > infinity, or if you accept that you NEED brackets, increase them to infinity and have a curve and do it properly and fairly and in a way that does make people feel aggrieved when they end up in a higher bracket all of a sudden and make less on that extra effort they invest 'all of a sudden'
Dave
I'm not going to get into a multiquote battle with you; why don't you try making one concise point, rather than spew out a bunch of hastily-written trash?
Seeing as you poo-pooed the idea of a £30k tax allowance on the last page, I think your idea of a large personal allowance is some piecemeal rise of £3k or so. As I have said a few times now, this still keeps those who earn very little on state subsidy as they are still earning below what is deemed to be a living wage - i.e. a wage that you can actually live on unassisted.
Seeing as I haven't endorsed any tax system, your allegations that I support more taxes for those below a living wage can be dismissed as straw man arguments.
Congrats on paying your fair share though.. I do too. Let's hope things stay that way.
Seeing as you poo-pooed the idea of a £30k tax allowance on the last page, I think your idea of a large personal allowance is some piecemeal rise of £3k or so. As I have said a few times now, this still keeps those who earn very little on state subsidy as they are still earning below what is deemed to be a living wage - i.e. a wage that you can actually live on unassisted.
Seeing as I haven't endorsed any tax system, your allegations that I support more taxes for those below a living wage can be dismissed as straw man arguments.
Congrats on paying your fair share though.. I do too. Let's hope things stay that way.
Countdown said:
Not sure why you say there isn't enough of them when the top 10% already pay 90% of income tax? And (as I think you said) a flat rate tax would encourage more compliance so the people most benefiting from evasion/avoidance will probably pay more tax...won't they?
It won't encourage more compliance if the top rate is much higher than it is now (which it would have to be in your scenario).HMRC manage to fk up tax codes when they have to run a tax-free allowance, 20%, 40% and 45%.
How the fk do you expect them to get a sliding scale right?!
KISS. If you make the system simple, it costs less to implement.
But never let that observation get in the way of a good old leftie demand for more money and a bigger public sector (maybe that's why these stupid ideas always get floated?)
k up tax codes when they have to run a tax-free allowance, 20%, 40% and 45%.How the f
k do you expect them to get a sliding scale right?!KISS. If you make the system simple, it costs less to implement.
But never let that observation get in the way of a good old leftie demand for more money and a bigger public sector (maybe that's why these stupid ideas always get floated?)
Mr Whippy said:
You're shafted because all of a sudden you pay a large amount of tax on earnings beyond a certain point.
Yep, so paying zero tax on £10k of income and paying £300 tax on £11,000 of income is so unfair....It seems perfectly reasonable that people deserve to keep a minimum amount of their earnings before they pay tax on the rest.
Mr Whippy said:
The work/reward ratio suddenly changes. I've spoken to lots of people who don't bother earning more because of benefit/tax bracket X or Y, "so whats the point"
Really? And yet those same people would support higher taxes for the rich, no doubt?! Mr Whippy said:
If you have a tax free allowance, then again suddenly the work/reward ratio changes and may influence behaviours. We know it does. If you are significantly worse off for investing extra effort, then it de-motivates.
You aren't 'significantly worse off. You are better off but to a lesser degree as you pay tax on a higher portion of your income.Mr Whippy said:
The current basic rate is quite low, but to go from tax free earnings at ~ £10,000 to around 30% tax flat rate would mean a huge rise in the number of people just earning around £10,000... and not bothering to work that extra day or two a week in their job just so they could pay a huge chunk of it in tax.
Mr Whippy said:
A ramping rate means there is no optimal point to choose, because the brackets are blended away.
And yet an increasing marginal rate would achieve the same effect for most people!Mr Whippy said:
What is so hard about paying tax differently on every pound earned? Why is that concept so difficult to grasp?
It's a simple function. Earn more, pay increasingly more tax. We do it already, but at a very granular level. All I'm saying is increase the granularity to remove the influence of the brackets.
Given the modern world we live in with computers and calculators, these calculations are trivial and irrelevant.
So everyone would need to do a tax return at the end of the year. That will be efficient.....It's a simple function. Earn more, pay increasingly more tax. We do it already, but at a very granular level. All I'm saying is increase the granularity to remove the influence of the brackets.
Given the modern world we live in with computers and calculators, these calculations are trivial and irrelevant.
Mr Whippy said:
No, rich people should pay a higher proportion of their earnings as tax, vs poor people.
They already do and would do under the above proposal. Quite why they 'should' do has yet to be justified...Mr Whippy said:
But adding more brackets will make it fairer for everyone, from very poor to very wealthy.
Cripes, the ramp rate doesn't even have to be that steep... but having ZERO tax at under £10k to a sudden 31% flat rate is just cretinous.
Cripes, the ramp rate doesn't even have to be that steep... but having ZERO tax at under £10k to a sudden 31% flat rate is just cretinous.
Mr Whippy said:
Either do it completely flat at 31% from 0 > infinity,
I'm sure the poorest in society might question that proposal!Mr Whippy said:
or if you accept that you NEED brackets, increase them to infinity and have a curve and do it properly and fairly and in a way that does make people feel aggrieved when they end up in a higher bracket all of a sudden and make less on that extra effort they invest 'all of a sudden'
Dave
Priceless!Dave
CamMoreRon said:
I'm not going to get into a multiquote battle with you; why don't you try making one concise point, rather than spew out a bunch of hastily-written trash?
Seeing as you poo-pooed the idea of a £30k tax allowance on the last page, I think your idea of a large personal allowance is some piecemeal rise of £3k or so.
As ever, what you think is usually wrong and without foundation.Seeing as you poo-pooed the idea of a £30k tax allowance on the last page, I think your idea of a large personal allowance is some piecemeal rise of £3k or so.
CamMoreRon said:
As I have said a few times now, this still keeps those who earn very little on state subsidy as they are still earning below what is deemed to be a living wage - i.e. a wage that you can actually live on unassisted.
Except it doesn't. So you are wrong again - a remarkably consistent pattern...If those on minimum wage were not forced to pay tax on those earnings then they'd have broadly the same as the net (after tax) amount of the 'living wage'.
CamMoreRon said:
Seeing as I haven't endorsed any tax system, your allegations that I support more taxes for those below a living wage can be dismissed as straw man arguments.
Congrats on paying your fair share though.. I do too. Let's hope things stay that way.
No, I pay way more than my fair share so that you can pay less. Congrats on paying your fair share though.. I do too. Let's hope things stay that way.
Like it or not.
Mr Whippy said:
If you have a tax free allowance, then again suddenly the work/reward ratio changes and may influence behaviours. We know it does. If you are significantly worse off for investing extra effort, then it de-motivates.
The current basic rate is quite low, but to go from tax free earnings at ~ £10,000 to around 30% tax flat rate would mean a huge rise in the number of people just earning around £10,000... and not bothering to work that extra day or two a week in their job just so they could pay a huge chunk of it in tax.
Dave
How much tax do you think someone earning £10,001.00 pay wiyh a flat rate and an allowance of £10,000.00?The current basic rate is quite low, but to go from tax free earnings at ~ £10,000 to around 30% tax flat rate would mean a huge rise in the number of people just earning around £10,000... and not bothering to work that extra day or two a week in their job just so they could pay a huge chunk of it in tax.
Dave
Is it £3000.30, or 30p?
mrpurple said:
– UKIP will increase personal allowance to the level of full-time minimum wage earnings (approx £13,500 by next election).
– We will introduce a 35p income tax rate between £42,285 and £55,000, whereupon the 40p rate becomes payable.
http://www.ukip.org/policies_for_people?utm_campai...
That would be a significant cut in income tax. So how will they pay for it.– We will introduce a 35p income tax rate between £42,285 and £55,000, whereupon the 40p rate becomes payable.
http://www.ukip.org/policies_for_people?utm_campai...
I note while cutting tax on income you will consider introducing a new tax on turnover.
"UKIP will set up a Treasury Commission to design a turnover tax to ensure big businesses pay a minimum floor rate of tax as a proportion of their UK turnover."
sidicks said:
Countdown said:
Not sure why you say there isn't enough of them when the top 10% already pay 90% of income tax? And (as I think you said) a flat rate tax would encourage more compliance so the people most benefiting from evasion/avoidance will probably pay more tax...won't they?
It won't encourage more compliance if the top rate is much higher than it is now (which it would have to be in your scenario).I'm a bit confused - they won't comply if the tax rate is higher (because it means they pay more tax) but they will comply if the tax rate is lower AND as a result of this compliance they will pay more tax???
All I've seen so far from flat rate advocates is "other people should pay more tax", which is fair enough and completely understandable. But it should be acknowledged that the people who don't support FRT do so for exactly the same reasons.
Jeez, read what I say.
You're WORSE OFF for the EXTRA TIME INVESTED, in a sudden jump, as you breach a tax bracket.
Yes you're better off overall, no one is arguing with that. But we have finite time to work, and so we balance work with living.
Is it worth working MORE to earn increasingly LESS, suddenly, at an arbitrary bracket point?
If you earned £10,000 working Monday to Thursday, and had the option of working a Friday, but Fridays pay would be taxed at 31%, would you bother?
I probably wouldn't. That extra work on Friday would seem like a lot of hard work for the extra money in my pocket.
You're WORSE OFF for the EXTRA TIME INVESTED, in a sudden jump, as you breach a tax bracket.
Yes you're better off overall, no one is arguing with that. But we have finite time to work, and so we balance work with living.
Is it worth working MORE to earn increasingly LESS, suddenly, at an arbitrary bracket point?
If you earned £10,000 working Monday to Thursday, and had the option of working a Friday, but Fridays pay would be taxed at 31%, would you bother?
I probably wouldn't. That extra work on Friday would seem like a lot of hard work for the extra money in my pocket.
don4l said:
Mr Whippy said:
If you have a tax free allowance, then again suddenly the work/reward ratio changes and may influence behaviours. We know it does. If you are significantly worse off for investing extra effort, then it de-motivates.
The current basic rate is quite low, but to go from tax free earnings at ~ £10,000 to around 30% tax flat rate would mean a huge rise in the number of people just earning around £10,000... and not bothering to work that extra day or two a week in their job just so they could pay a huge chunk of it in tax.
Dave
How much tax do you think someone earning £10,001.00 pay wiyh a flat rate and an allowance of £10,000.00?The current basic rate is quite low, but to go from tax free earnings at ~ £10,000 to around 30% tax flat rate would mean a huge rise in the number of people just earning around £10,000... and not bothering to work that extra day or two a week in their job just so they could pay a huge chunk of it in tax.
Dave
Is it £3000.30, or 30p?
But they had to work 0.1% more time, and they got 30% less money for it all of a sudden.
I'd prefer to pay 0.01p tax. Then 0.02p tax on the next £1 over £10,000 etc etc... that is fairer to me, as there is no sudden disincentive to bother working that bit harder, or longer as it increasingly tends to be for people earning at these levels (ie, part time etc)
Dave
Mr Whippy said:
FFS, 30p.
But they had to work 0.1% more time, and they got 30% less money for it all of a sudden.
I'd prefer to pay 0.01p tax. Then 0.02p tax on the next £1 over £10,000 etc etc... that is fairer to me, as there is no sudden disincentive to bother working that bit harder, or longer as it increasingly tends to be for people earning at these levels (ie, part time etc)
Dave
Wow!But they had to work 0.1% more time, and they got 30% less money for it all of a sudden.
I'd prefer to pay 0.01p tax. Then 0.02p tax on the next £1 over £10,000 etc etc... that is fairer to me, as there is no sudden disincentive to bother working that bit harder, or longer as it increasingly tends to be for people earning at these levels (ie, part time etc)
Dave
PH is full of surprises.
don4l said:
Mr Whippy said:
FFS, 30p.
But they had to work 0.1% more time, and they got 30% less money for it all of a sudden.
I'd prefer to pay 0.01p tax. Then 0.02p tax on the next £1 over £10,000 etc etc... that is fairer to me, as there is no sudden disincentive to bother working that bit harder, or longer as it increasingly tends to be for people earning at these levels (ie, part time etc)
Dave
Wow!But they had to work 0.1% more time, and they got 30% less money for it all of a sudden.
I'd prefer to pay 0.01p tax. Then 0.02p tax on the next £1 over £10,000 etc etc... that is fairer to me, as there is no sudden disincentive to bother working that bit harder, or longer as it increasingly tends to be for people earning at these levels (ie, part time etc)
Dave
PH is full of surprises.
Maybe it won't impact people with a good PAYE salaried job, but if you had a £10,000 tax free threshold and then went straight to a 30% or so flat rate it'd do weird things for people earning in that region, or on part time in that region.
Why bother working more time if suddenly you pay 30% of that extra day you drag your arse to a job, rather than getting all the money like you do if you just do 3 days rather than 4?
Add in factors that are fixed costs, like travel to/from work, and perhaps child care for that extra day, and the ratio widens even further.
A constantly variable rate makes good sense.
For the most part you could add fractions of percent to £500k+ earners, but provide whole percentages off to those in the £50,000 region for example...
But instead with just a few brackets it's hard to give middle earners a good reduction in absolute tax without also giving a much larger one to really high earners.
Dave
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