Tax break imminent for those on high earnings?

[I1L2T3]

So you pay the minimum you can possibly get away with.

 

You're practically a criminal

 

Nope, I don't pay the mimimum I can possibly get away with. I pay the correct amount.

[I1L2T3]

Beer time again

 

Suppose that once a week, ten men go out for beer and the bill for all ten comes to £100.If they paid their bill the way we pay our taxes, it would go something like this..

 

The first four men (the poorest) would pay nothing.

The fifth would pay £1.

The sixth would pay £3.

The seventh would pay £7.

The eighth would pay £12.

The ninth would pay £18.

And the tenth man (the richest) would pay £59.

So, that's what they decided to do.

 

 

 

The ten men drank in the bar every week and seemed quite happy with the arrangement until, one day, the owner caused them a little problem. "Since you are all such good customers," he said, "I'm going to reduce the cost of your weekly beer by £20.” Drinks for the ten men would now cost just £80.

 

 

 

The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still drink for free but what about the other six men? The paying customers? How could they divide the £20 windfall so that everyone would get his fair share? They realized that £20 divided by six is £3.33 but if they subtracted that from everybody's share then not only would the first four men still be drinking for free but the fifth and sixth man would each end up being paid to drink his beer.

 

So, the bar owner suggested that it would be fairer to reduce each man's bill by a higher percentage. They decided to follow the principle of the tax system they had been using and he proceeded to work out the amounts he suggested that each should now pay.

 

And so, the fifth man, like the first four, now paid nothing (a100% saving).

The sixth man now paid £2 instead of £3 (a 33% saving).

The seventh man now paid £5 instead of £7 (a 28% saving).

The eighth man now paid £9 instead of £12 (a 25% saving).

The ninth man now paid £14 instead of £18 (a 22% saving).

And the tenth man now paid £50 instead of £59 (a 15% saving).

Each of the last six was better off than before with the first four continuing to drink for free.

 

But, once outside the bar, the men began to compare their savings. "I only got £1 out of the £20 saving," declared the sixth man. He pointed to the tenth man, "but he got £9!"

 

"Yeah, that's right," exclaimed the fifth man. "I only saved a £1 too. It's unfair that he got nine times more benefit than me!"

 

"That's true!" shouted the seventh man. "Why should he get £9 back, when I only got £2? The wealthy get all the breaks!"

 

"Wait a minute," yelled the first four men in unison, "we didn't get anything at all. This new tax system exploits the poor!" The nine men surrounded the tenth and beat him up.

 

The next week the tenth man didn't show up for drinks, so the nine sat down and had their beers without him. But when it came time to pay the bill, they discovered something important - they didn't have enough money between all of them to pay for even half of the bill!

 

And that, boys and girls, journalists and government ministers, is how our tax system works. The people who already pay the highest taxes will naturally get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy and they just might not show up anymore. In fact, they might start drinking overseas, where the atmosphere is somewhat friendlier.

 

 

For those who understand, no explanation is needed.

For those who do not understand, no explanation is possible

 

The flaw in your argument is that it ignores how people got wealthy in the first place . In contemporary Britain, for a fair proportion of the people in the 50% tax band, that is going to involve ill-gotten gains.

 

If people want to take their chances overseas let them go. There are plenty willing to take their place.

 

Studies in the US showed that tax hikes for the very rich in some states did not lead to the expected exodus. In some states it amounted to a handful of families.

[ECCOnoob]

Nope, I don't pay the mimimum I can possibly get away with. I pay the correct amount.

 

And who tells you what that correct amount is?

 

The HMRC as assessed on the evidence you, your accountant or your employer submits. All these people will no doubt seek advice on what can and cant be submitted, what is tax deductable and what can and can't be claimed for.

 

On the basis of this advice you will submit your claim to HMRC and pay the bill they demand. Nobody should ever pay more tax than they have to and certainly nobody will ever volunteer to pay extra if they are not compelled to by law. Why should they

 

So..... Mr Moral High Ground.... What makes you any different to everybody else.

[ECCOnoob]

The flaw in your argument is that it ignores how people got wealthy in the first place . In contemporary Britain, for a fair proportion of the people in the 50% tax band, that is going to involve ill-gotten gains.

 

If people want to take their chances overseas let them go. There are plenty willing to take their place.

 

Studies in the US showed that tax hikes for the very rich in some states did not lead to the expected exodus. In some states it amounted to a handful of families.

 

Like what?

 

I doubt anyone is that stupid to put illegal gains through their tax process.

 

Business is not always a nice world. Things get obtained, bought, sold, bidded on or closed down. This might be done tatically, sneakilly or ruthlessly but it does not necessarilly mean it can be called "ill gotten gains"

[ricgem2002]

Like what?

 

I doubt anyone is that stupid to put illegal gains through their tax process.

 

Business is not always a nice world. Things get obtained, bought, sold, bidded on or closed down. This might be done tatically, sneakilly or ruthlessly but it does not necessarilly mean it can be called "ill gotten gains"

a bit like this you mean http://www.dailymail.co.uk/news/article-1165611/Blue-movies-expenses-Jacqui-Smiths-husband-apologises-watching-porn--paid-taxpayer.html :hihi:

[Doingalright]

High earning people are hard working go getters, and they pay plenty of tax. They pay for the public sector, so the Labour left and the unions should stop biting the hand that feeds them.

[ECCOnoob]

Its hardly the same thing.

 

Besides. He got caught out for it as it was a clear breach of the rules.

 

The topic is about about tax payments and HMRC here.

[I1L2T3]

And who tells you what that correct amount is?

 

The HMRC as assessed on the evidence you, your accountant or your employer submits. All these people will no doubt seek advice on what can and cant be submitted, what is tax deductable and what can and can't be claimed for.

 

On the basis of this advice you will submit your claim to HMRC and pay the bill they demand. Nobody should ever pay more tax than they have to and certainly nobody will ever volunteer to pay extra if they are not compelled to by law. Why should they

 

So..... Mr Moral High Ground.... What makes you any different to everybody else.

 

People are not compelled to seek out expensive tax avoidance lawyers to drive their tax base as low as possible. You know and I know that is not how it works. Next argument please.

[I1L2T3]

Like what?

 

I doubt anyone is that stupid to put illegal gains through their tax process.

 

Business is not always a nice world. Things get obtained, bought, sold, bidded on or closed down. This might be done tatically, sneakilly or ruthlessly but it does not necessarilly mean it can be called "ill gotten gains"

 

I use the term ill-gotten gains very loosely. There are myriad ways in which those at the top of the tree can feather their nests.

 

Certainly the law is not always broken but for certain economic sectors and political groups in the news recently there is unfortunately quite a reputation for dishonesty and dodgy dealing. Cameron himself just today has condemned the behaviour of people in prominent positions. The elite, like the looters it seems, have a culture of just taking what they want. Make of that what you want but the language is undeniably strong - "greed, irresponsibility, entitlement"

[ECCOnoob]

People are not compelled to seek out expensive tax avoidance lawyers to drive their tax base as low as possible. You know and I know that is not how it works. Next argument please.

 

Where did I say anything about expensive tax avoidance lawyers?

 

I dont need to pay for lawyers to get my tax advice I get it from the HMRC and my accountant if necessary. Just like millions of other people. They still tell me legally what I can and can't claim for and I use that guidance to fill in my tax returns. That way everyone makes sure they dont pay any more than they need to...... or of course on the flip side make sure they dont forget to put through things they should