Does anyone agree with taking money off the poor to give to the rich?

[tinfoilhat]

Put simply you cannot have a discussion about a fair taxation policy without a debate on how people have arrived at their renumeration.

 

Yep I think those getting paid over £150000 should be paying the higher rate of tax as they've been blessed with the ability to earn more, but this doesn't make them meriting of it as other people with different skills could argue the same but as those skills don't make money then they aren't as valued.

 

In my firm the Sales people get paid the most, but in most peoples eyes they don't earn it.

 

Nobody likes salesmen, but they wouldn't half miss them if they left and there was nobody there to generate income.

 

Actually, that's a reasonable analogy for higher earners. I didn't even do that on purpose either. ;)

 

But in the bigger scheme of things 150k is not mega money. I bet most Nhs consultants earn that, in fact it will be interesting to see if the Nhs can Hoover up any French ones bailing out of the great socialist experiment accross the channel. I bet a fair few have left to go to other European countries already.

[Mister M]

The Torys aren't only shooting themselves in the foot, they are blowing their own brains out.:hihi:

 

If Labour get their act together and Milliband shows a bit more aggression they will walk the next election.

 

As for this Forum, it is too full of the 'I'm all right Jack' types. They have no compassion or concern for their fellow man, many seem to take delight in inflicting pain and misery on people less fortunate than themselves. They rant on about 'hard work', and self reliance whilst probably occupying boring little office jobs and reading forums most of the day. I myself had my own business for 14 years and before that I spent over 10 years working on a 'payment by results' system. AND I AM STILL A SOCIALIST and always will be. I could name a couple of furummers who live on their own, leading sad little lives and deluding themselves that they are better than other people. One cliche descibes them.........two bob millionaires.

They would rob their own grandmothers........

 

I think the Governemnt encourages this kind of mentality when they play one group off against another - private sector workers against public sector workers; the middle class against the low paid; and the low paid against the those on benefits.

That logic never extends to their own class though as they **** in the same pot.

Some people fall for it, others can see through it.

[L00b]

I'm not even sure how the Government is measuring the results of the policy, are they looking at revenue from the individuals affected or taxation as a whole?

Would be my answer fo the Gvt.

 

They are not mutually exclusive at all: I'd fully expect HMRC to keep a bead on the 'obvious' ones (known to avoid/evade but insufficient proof or uneconomical to act) and be able to quantify precisely the additional take in such circumstances, and the Gvt to be more interested by the macro-economical result (.e. is the whole tax income increasing or not?).

Ultimately I still come back to my viewpoint in that I cannot see a specific type of person who would end up paying more tax following a reduction in it.

I would: the persons/companies who elect to stop evading/reduce the scale of their avoidance, because the lowered rate now renders the evasion/avoidance uneconomic. There are many such persons. Even very senior servants in the Gvt itself, acc. to recent news

 

Hypothetic example: a person working in the UK but fiscally domiciled in Luxembourg behind an off-the-shelf S.à.r.l. 'saves' 20% gross relative to the UK taxation rates, but the 'cost' of these savings is 5% (bank charges, legal intermediaries, etc. so 15% effective). Remember that in this situation, HMRC is getting a big fat zero (all taxes paid to Luxemburg tax office instead).

 

Now, lowering one or two UK tax rates that apply to this person diminishes the gross saving rate to now, say, 5% gross. The 'cost' of these savings is still 5% (bank charges, legal intermediaries, etc. - same service, same cost) so now 0% effective. Might as well declare the income in the UK and save the hassle, as it gains the person nothing. HMRC now gets the full take (under the reduced rate).

 

Multiply by all finding themselves in this position and opting to do likewise = lowered tax rate, increased tax income.

 

This is a grossly-simplified example with fictitious figures, of course, simply intended to convey the gist of the measure.

[*_ash_*]

Celtic already top and no one shall stop us winning the Championship

 

Precisely! Almost a dead cert. In fact, even with a 3 year accumulator, if you put on £100 on ALL 3 titles for the next 3 seasons, (at current odds for this year & using this years pre-season odds for the next 2) you would get a return of £107.21!

 

Might as well just put the 100 in the bank!

 

If L00b can find 3/1 or better in his guess for France, I'll go for it

[I1L2T3]

Bit of a truism there, I1L2T3, which does not progress the debate much (and is not really a counter-argument, or... what's your point? )

 

Would you happen to know better than the Gvt how close to/far from this "optimum point" the UK is?

I always look at tax avoidance/evasion by those concerned as a cost-benefit exercise: what's the gain, what are the risks, what efforts are needed to exploit it.

 

There comes a point at which the risks and efforts outweigh the gains, and that point is entirely dictated by the taxation rate/asset types (i.e. the Laffer curve in application indeed, supplemented as it is by the scale of statutory penalties for evasion).

 

...Nowt to do with 'fairness' (IMHO, but then again I am one cold-hearted barsteward where £s are concerned , fully at home in Yorkshyre )

And that particular drum I've banged a lot lately. Funny how the UK left/centre-of-left powers of observation seem to suddenly stop at the Dover cliffs, since Hollande got in I'm still laughing at Hollande's blue/white collar working electorate, whose overtime income he decided to tax pretty much as soon as he went in.

 

It's very difficult to know. The reason for my post is that you can't know for sure whether we need to increase or decrease taxation, and because a reduction might have worked in the past that doesn't mean it is right now.

 

Also falling tax revenues is not necesarilly a sign that rates are set too high, in our case it's a sign that the economy is seriously struggling. Could tax cuts stimulate the economy? Maybe, but then you have to consider that many people would either hoard the extra cash or use it to pay down debt. As for the 45p rate that hasn't kicked in yet so we'll have to wait and see how that transpires.

[*_ash_*]

It's very difficult to know. The reason for my post is that you can't know for sure whether we need to increase or decrease taxation, and because a reduction might have worked in the past that doesn't mean it is right now.

 

Also falling tax revenues is not necesarilly a sign that rates are set too high, in our case it's a sign that the economy is seriously struggling. Could tax cuts stimulate the economy? Maybe, but then you have to consider that many people would either hoard the extra cash or use it to pay down debt. As for the 45p rate that hasn't kicked in yet so we'll have to wait and see how that transpires.

 

You could compare how much was made during each of the 13 years 40% high-tax rate under Labour, with the new 50% current one which they introduced just before they knew they would lose before Coalition came in (though of course since it was new you have to total up both 100K and new 150K bands together to compare with the earlier years)

 

All the figures (projections etc) are easily available online. (+£6.78b)

[Mecky]

But if we upped our tax a bit too much, we'd have people leaving and moving overseas and taking all that with them.

 

So you're saying if we didn't tax wealthy people as much they'd move all their money to the UK and would be happy to pay UK taxes rather than paying zilch like they do in Monte Carlo or whatever, like they've always done?

[I1L2T3]

You could compare how much was made during each of the 13 years 40% high-tax rate under Labour, with the new 50% current one which they introduced just before they knew they would lose before Coalition came in (though of course since it was new you have to total up both 100K and new 150K bands together to compare with the earlier years)

 

All the figures (projections etc) are easily available online. (+£6.78b)

 

You could but you're comparing boom years with bust years. Tax receipts fall during a recession.

[Obelix]

So you're saying if we didn't tax wealthy people as much they'd move all their money to the UK and would be happy to pay UK taxes rather than paying zilch like they do in Monte Carlo or whatever, like they've always done?

 

Basically yes. I give you the example of Lamont and cutting tax from 60 to 40% which immeditaly brought in the very next year a healthy rise in tax receipts.

 

Also, you don't pay nothing in Monte Carlo, and there are associated costs with setting that up, living there, etc. A truly zero rated tax system tends to have no public services like Afghanistan, which makes it less than ideal as a place to live.

[L00b]

It's very difficult to know. The reason for my post is that you can't know for sure whether we need to increase or decrease taxation, and because a reduction might have worked in the past that doesn't mean it is right now.

Indeed - but I'd sooner trust HMRC and relevant top-level civil servants to know (or have at least a very-well informed take on the matter), than you(-r opinion on the matter). Unless you are a Westminster mandarin and you have actually seen the figures, of course No offense

Also falling tax revenues is not necesarilly a sign that rates are set too high, in our case it's a sign that the economy is seriously struggling. Could tax cuts stimulate the economy? Maybe, but then you have to consider that many people would either hoard the extra cash or use it to pay down debt. As for the 45p rate that hasn't kicked in yet so we'll have to wait and see how that transpires.

As previously put to Titanic, procrastinating in the matter gains nothing/gets us nowhere.

 

If it's tried and it works, everybody's quids in. If it's tried and doesn't work, then something else needs to be tried.

 

The fact of the matter is that it has been proven to work in similar (though admittedly not quite as drastic-) circumstances, and this Gvt is tasked with rebuilding a national economy from nigh-on the ground up, so has got to try just about everything in the book.

 

So, would you blame the Gvt for giving this measure (amongst others) a go, or not? (my original, core point was that, in the current context, this measure is apolitical and opinions that it amounts to "Cons chumming up to the rich" are, in a word, stupid: Labour (or another) would probably try it just the same).