This 50p tax rate

tailwindhome

INTERVENTION

I remember a time when you used to start threads about bike stuff, then you developed forum tourettes and every thread descended into a war between you and Biondino over what was and wasn't appropriate. Those were great days......

But you've become very middle aged all of a sudden, it's sad to see. You're the forum equivalent of a middle class dinner party and are one post away from quoting Kirtsy Allsop

Buck your ideas up young fella.

tailwindhome

It's not without hope.

viewtopic.php?f=40012&t=12797672&start=200#p17297830

rhext

DonDaddyD wrote:

jamesco wrote:

DonDaddyD wrote:

Let me make it clear. I don't think they should take 50% of what you earn even over a certain threshold. You should always be able to take home more than what is given to the state. So that £1 over the threshold I don't think it's right they take 50% of that.

Inheritance tax should go as well, disgusting that.

50% doesn't worry me, but no problem, we all have different opinions what a fair rate is. Wiping out estate tax, on the other hand, would be utter madness unless you want an entrenched aristocracy, an impoverished population and no social mobility.

I take real issue with people looking at what other people have. I don't care about entrenched aristocracy that's there look out.

If I've worked hard to leave something behind for my loved ones I don't see why the Government should take any percentage/portion of that. I find the very thought of it absolutely disgusting.

An entrenched aristocracy is undesirable from 'the general public' point of view, not from the aristocracy's point of view. You're thinking of it from the position of someone who might manage to amass a reasonable (say six-figure) inheritance, which you want to pass onto your kids. But say you managed to amass a nine-figure sum. Once you get to that sort of level, you start to get into a 'wealth accumulates wealth' situation and before you know it you have an over-class owning the vast majority of the country's assets whose only qualification for the position is the fact that their great-great-great-great grandparents were particularly successful at something.

I reckon that if you support freedom of opportunity you almost have to support some level of inheritance tax! Maybe debate the threshold, but I think abandoning the principle would be a terrible mistake.

It's not as if the threshold for inheritance tax is tiny either: you can pass on almost a third of a million quid before it cuts in.

il_principe

A third of a million - that barely covers a house in SE England.

rhext

Il Principe wrote:

A third of a million - that barely covers a house in SE England.

Like I said, a debate on thresholds might be worthwhile, but not principle.

jamesco

rhext wrote:

An entrenched aristocracy is undesirable from 'the general public' point of view, not from the aristocracy's point of view. You're thinking of it from the position of someone who might manage to amass a reasonable (say six-figure) inheritance, which you want to pass onto your kids. But say you managed to amass a nine-figure sum. Once you get to that sort of level, you start to get into a 'wealth accumulates wealth' situation and before you know it you have an over-class owning the vast majority of the country's assets whose only qualification for the position is the fact that their great-great-great-great grandparents were particularly successful at something.

I reckon that if you support freedom of opportunity you almost have to support some level of inheritance tax! Maybe debate the threshold, but I think abandoning the principle would be a terrible mistake.

It's not as if the threshold for inheritance tax is tiny either: you can pass on almost a third of a million quid before it cuts in.

+1 Really well said.

The mistake that many opponents of estate tax and higher marginal taxes is that they believe that if it doesn't affect them now, it will in the future. It's the exact opposite - without these taxes, the chances of social mobility are greatly reduced. Yes, the thresholds have to be reasonable, but not too high. Eliminating them altogether would be a disaster for society (if you believe that there is such a thing...).

DonDaddyD

TailWindHome wrote:

INTERVENTION

I remember a time when you used to start threads about bike stuff, then you developed forum tourettes and every thread descended into a war between you and Biondino over what was and wasn't appropriate. Those were great days......

But you've become very middle aged all of a sudden, it's sad to see. You're the forum equivalent of a middle class dinner party and are one post away from quoting Kirtsy Allsop

Buck your ideas up young fella.

I remember that. I typed flippantly "I had sex today" because people were arguing about something boringly pointless in the SCR thread no less. I felt those participating seriously needed some perspective of what really mattered. In those days it was sex, before it became extinct.

Then all of a sudden I had the self righteous e-finger of the Internet Forum e-lecturing me. The e-anger from some people; clearly it was a longing to get laid to such a degree that the sheer utterance of the word "sex" threw them into a blind e-rage. And so begun the DDD e-war of '08 - '09. That was before I created the Power Awesome (TM) and people learned not to mess with me.

Those were the days.

But you see sex, it's extinct. Died out from over use, over hunting and more demand than supply. I blame people who blame the banks. Without the debauchery of the bankers coke filled sexual endeavors we don't see the drip down filth. When was the last time you saw new porn on the Internet? Or read a story about a club night that simply just got out of hand? It was a banker that demanded the creation of the Rabbit, some say his name was Greg T.hough I don't know. Torchwood should do a mini-series on it. Ah, sex, t'was my life blood. Without it I ride my bike 3mph slower and what's left is a Labour voting Tory trying to desperately to cling onto the last vestiges of made him awesome...

I call it Fatherhood.

First.Aspect

rhext wrote:

Anyway, if you think the 50p marginal rate is bad, what about the 60p marginal rate that cuts in between £100K and £119K?

It doesn't exist. That's what.

but yeah, all those GP's must all be really cheesed off about it...

EKE_38BPM

jedster wrote:

In your example, I see your point, but an accountant will help said bank manager to limit his tax exposure by tax avoidance methods. I don't know what they are, but I know they exist.

You know Eke, that's pretty much bollocks. If you are employed (as opposed to running your own business) there is very little that you can do to avoid income tax. I get paid in a mixture of cash and shares. The shares are in a US company and when I actually get them (years after they are awarded) they go to a US brokerage and any sales proceeds go to a US bank account. Sounds like an opportutiny to avoid tax? Not at all, all of that gets reported through my PAYE and taxed by the inland revenue. The only thing I can do to avoid tax is the same thing as you - pay into my pension. And of course that gets taxed when I draw it in retirement.

These days the UK income tax system is actually pretty simple and doesn't have all those loopholes. Certainly proper companies wouldnt play fast and loose with that stuff anyway.

I think most Brits just have to pay up and very few are moving abroad. I do know people that HAVE moved abroad in response to the 50% tax rate though. These are typically not Brits, the one I know are other Europeans who were working and living in London but whose work involved a lot of travel. Given they didn't have deep roots in London, it was easy for them to switch to working from an office in Switzerland. They are still in London quite a lot (just like they are in Paris, Frankfurt and New York) the difference is they are keeping much more of their salary and the the UK Treasury has lost all their income tax, NI, council tax, most of their VAT, etc, etc.

I tend to agree with that guy quoted in the FT - the country is in a mess, everyone needs to do their bit and most people will just pay up. That said, I think it takes quite a lot of us paying up the extra 10% to compensate for those peopel who have moved to Switzerland and I'm not sure the sums stack up for the Government. Longer-term, I agree with DDD, simple justice and freedom suggests that if you earn a £1 you should be able to keep at least 50p*.

*Incidently, that should apply at the botttom end where if you earn an £1 you shouldn't lose more than 50p in benefits.

I'm pretty annoyed by your suggestion that someone like me is stupid because I obey the law and pay my taxes. Frankly that's a pretty disgusting attitude to take.

J

I didn't say or suggest that someone like you is stupid for obeying the law and paying taxes. If thats what you take from my posts, thats your problem, not mine.
I suggest you read what has been written before exploding with disgust.

As I said, I don't know what the tax avoidance methods are, but I know they exist. Maybe if you (or me or anyone) employed a high-end tax accountant, the accountant would be able to point out these methods.

greg66_tri_v2.0

DonDaddyD wrote:

I accept what you're saying to a point.

It's just that this whole "it's London so it's expensive so we need to get paid more" compounds on the issue that leads to situations like the 50% tax rate and people getting paid huge amounts and claiming that it isn't really that much because "it's London".

Not everyone needs a new - 4year old Audi, 3-4 bedroom semi-detached and has to live within Zone 3 to enjoy London and live comfortably. As I said people have lost sight of value. I earn less than a 3rd of the discussed £150,000k and I live a good life, can afford to keep my home and my family and have money left over for me.

£150,000k is a huge amount of money when you consider £50,000k can leave you happy and £30,000k can see you comfortable.

Also I'd happily live:
<snip>

This is laudable. But unrealistic, I think.

These people of whom you speak: they earn £150k+ and live the lifestyle of someone who earns £50k. Do you know who they are? Broadly, they are weird hermit like people who smell funny, eat cat food and have hard folding cash hidden in their houses because the don't trust banks.

I would *love* to see how long you'd last earning £150k before you wanted to live a commensurate lifestyle. Simple fact is that someone who earns that much *earns* it. It doesn't grow on trees. And most people in that position start thinking "I need some rewards to remind myself that the hard graft I put in/shit working life I have is actually worth something, and worth continuing with".

Hence the bigger house, nicer car, five star holidays etc. And that's before you've got onto London "essentials" such as private schooling.

Read the beginning of the Bonfire of the Vanities. As the Master of the Universe is walking up the stairs to his Upper West Side apartment, he runs through in his head all of the standing financial commitments he's entered that come out of his $1million pa income. He reckons he's left with about $20k for himself at the end of it.

That's life, that is.

First.Aspect

anonymousblackfg wrote:

From my view we need do everything we can to maintain high earners in this country, there is no industry to bring the cash in so we need keep something in the UK.

That's something of a misconception though, isn't it? Undrstandable if you and most of the people you know work in a service industry in London. But about 15% of GDP comes from manufacturing. If that sounds low, bear in mind that "very high" is China's 30-35ish%. Japan and Germany are around 20% of GDP. So, okay, its not as high as it used to be, or even as high as you might want, but add in the associated non-service parts of the economy and I'd say that you are probably being a bit dismissive there.

Want to know how important the financial sector is by comparison? About 10% of GDP. So why the ludicrously inflated salaries and economic policies biased towards it, I wonder?

Shopping accounts for the remaining 75% of the UK economy - FACT

lost_in_thought

Greg66 wrote:

DonDaddyD wrote:

I accept what you're saying to a point.

It's just that this whole "it's London so it's expensive so we need to get paid more" compounds on the issue that leads to situations like the 50% tax rate and people getting paid huge amounts and claiming that it isn't really that much because "it's London".

Not everyone needs a new - 4year old Audi, 3-4 bedroom semi-detached and has to live within Zone 3 to enjoy London and live comfortably. As I said people have lost sight of value. I earn less than a 3rd of the discussed £150,000k and I live a good life, can afford to keep my home and my family and have money left over for me.

£150,000k is a huge amount of money when you consider £50,000k can leave you happy and £30,000k can see you comfortable.

Also I'd happily live:
<snip>

This is laudable. But unrealistic, I think.

These people of whom you speak: they earn £150k+ and live the lifestyle of someone who earns £50k. Do you know who they are? Broadly, they are weird hermit like people who smell funny, eat cat food and have hard folding cash hidden in their houses because the don't trust banks.

I would *love* to see how long you'd last earning £150k before you wanted to live a commensurate lifestyle. Simple fact is that someone who earns that much *earns* it. It doens't grow on trees. And most people in that position start thinking "I need some rewards, to remind myself that the hard graft I put in/shoot working life I have is actually worth something, and worth continuiing with".

Hence the bigger house, nicer car, five star holidays etc. And that's before you've got onto London "essentials" such as private schooling.

Read the beginning of the Bonfore of the Vanities. As the Master of the Universe is walking up the stairs to his Upper West Side apartment, he runs through in his head all of the standing financial commitments he's entered that come out of his $1million pa income. He reckons he's left with about $20k for himself at the end of it.

That's life, that is.

Aye, I have a few friends who earn 150k+, all of whom assert that the amount they have left over after financing the lifestyles they feel compelled to have (commensurate with their salaries) in a sort of keeping up with the Joneses style is actually not a huge amount more than someone on 50-ish k.

There's one of those laws, like sods law, or murphy's law, or godwin's law, that states that however much storage you have, your stuff will expand to use it all up.

I think similar applies to money to an extent - no matter how much you have your life will expand to take it all up.

First.Aspect

Rick Chasey wrote:

I guess the point I'm making is that to talk about this properly ,you need to separate London and the rest of the UK, since the London economy is so vastly different to the rest. What constitutes a lot of earnings in one area won't be a lot in another.

For what it's worth, for the rent of my 1 bedroom flat in London that I share with my GF, I could get a 4 bed detached in a 'award winning picturesque village' near Bradford with a big garden.

It's barely comparable.

What about a flat in (fairly) central: Edinburgh, Oxford, Cheltenham, Bath etc.? And what could you rent for the same amount you are paying in somewhere like Guildford?

In any case, what are average earnings in Bradford, I wonder? Or the unemployment rate? Can you even do what you do for a living in Bradford? Personally, I could afford to live in a large house on a remote Scottish hillside for what I pay to live very modestly near Edinburgh, only I couldn't, because I'd be unemployed.... which is pretty much why where I live is more expensive than a remote Scottish hillside.

Basically, don't make silly comparions.

First.Aspect

Aye, I have a few friends who earn 150k+, all of whom assert that the amount they have left over after financing the lifestyles they feel compelled to have (commensurate with their salaries) in a sort of keeping up with the Joneses style is actually not a huge amount more than someone on 50-ish k.

There's one of those laws, like sods law, or murphy's law, or godwin's law, that states that however much storage you have, your stuff will expand to use it all up.

I think similar applies to money to an extent - no matter how much you have your life will expand to take it all up.

So, basically you are all saying that if you earn loads and spend most of it, the only benefit you have over the people who earn less and spend most of it is all the stuff you've spent it on that they can't afford?

Are you actually arguing that because you feel a bit pressured into having to buy stuff, the cost of the stuff you've bought limits the available income with which to buy stuff, which makes sad panda like middle income panda?

Have I woken up inside an eposide of TOWIE?

First.Aspect

Il Principe wrote:

Inheritance tax is disgusting. Or at least it was in the early 80's as my dear Mum will attest - had to sell her home to pay the sodding bill.

Now its proportionally even more disgusting. In fact, so far as being taxed twice goes, its even more disgusting than paying VAT on fuel duty, because the numbers are much larger.

Come to think of it, VAT on fuel duty is at least 3 levels of tax, because the income that bleeds straight into your car is also taxed.

rhext

First Aspect wrote:

rhext wrote:

Anyway, if you think the 50p marginal rate is bad, what about the 60p marginal rate that cuts in between £100K and £119K?

It doesn't exist. That's what.

but yeah, all those GP's must all be really cheesed off about it...

Yes it does. When you get to £100K, your personal allowance starts to be withdrawn. The net effect is a marginal rate of 60p in the £. Not got there, but it kind of underlines for me how over-complex the system is. I think a flat tax has a lot of merit. In fact, I'd lump it all together: income, capital gains, inheritance, even benefit, all treated as income and taxed proportionally above a threshold. Simple, easy to administer and difficult to avoid.

rhext

First Aspect wrote:

Il Principe wrote:

Inheritance tax is disgusting. Or at least it was in the early 80's as my dear Mum will attest - had to sell her home to pay the sodding bill.

Now its proportionally even more disgusting. In fact, so far as being taxed twice goes, its even more disgusting than paying VAT on fuel duty, because the numbers are much larger.

Come to think of it, VAT on fuel duty is at least 3 levels of tax, because the income that bleeds straight into your car is also taxed.

Tax is levied on transactions though, not a given £. Otherwise where do you draw the line? There's no inherent rule says you should only pay tax once on a given £ earned: in most cases you already pay once when you earn it and once again when you spend it.

You earn a £, pay tax, use the balance to pay someone for a service, they pay tax again. To me, it's the same with inheritance tax: earn it, pay tax, use the balance to pass to your kids, they pay tax again.

First.Aspect

Trying to be glib on this thread is about as much fun as using sarcasm on an American.

First.Aspect

rhext wrote:

First Aspect wrote:

rhext wrote:

Anyway, if you think the 50p marginal rate is bad, what about the 60p marginal rate that cuts in between £100K and £119K?

It doesn't exist. That's what.

but yeah, all those GP's must all be really cheesed off about it...

Yes it does. When you get to £100K, your personal allowance starts to be withdrawn. The net effect is a marginal rate of 60p in the £. Not got there, but it kind of underlines for me how over-complex the system is. I think a flat tax has a lot of merit. In fact, I'd lump it all together: income, capital gains, inheritance, even benefit, all treated as income and taxed proportionally above a threshold. Simple, easy to administer and difficult to avoid.

I thought the marginal rate was the rate on the last £ you earned, which is still 50%.

Anyway, yes, I agree with you and DDD on this one. Don't some people attribute the economic miracle that was Hong Kong to a low, flat rate of tax - which ended up pulling proportionally more than higher rates in more complex tax systems? ie the hk govt had more to spend on people who were taxed less? Or am I thinking of Singapore?

lost_in_thought

First Aspect wrote:

Aye, I have a few friends who earn 150k+, all of whom assert that the amount they have left over after financing the lifestyles they feel compelled to have (commensurate with their salaries) in a sort of keeping up with the Joneses style is actually not a huge amount more than someone on 50-ish k.

There's one of those laws, like sods law, or murphy's law, or godwin's law, that states that however much storage you have, your stuff will expand to use it all up.

I think similar applies to money to an extent - no matter how much you have your life will expand to take it all up.

So, basically you are all saying that if you earn loads and spend most of it, the only benefit you have over the people who earn less and spend most of it is all the stuff you've spent it on that they can't afford?

Are you actually arguing that because you feel a bit pressured into having to buy stuff, the cost of the stuff you've bought limits the available income with which to buy stuff, which makes sad panda like middle income panda?

Have I woken up inside an eposide of TOWIE?

Careful now, I hear soapboxes are slippery.

I was agreeing with 66. I don't recall responding to a post of yours. Maybe it was a comatose reaction from my massive stash of gold bullion emitting some kind of fumes.

First.Aspect

Okay, Marie, you and Greg just carry on with your private chat. I'll ask permission if I want to interrupt.

greg66_tri_v2.0

First Aspect wrote:

Okay, Marie, you and Greg just carry on with your private chat. I'll ask permission if I want to interrupt.

You know, you were much less of a pain in the ass when you were Always Tyred.

First.Aspect

Greg66, LiT.....I am disappoint.

greg66_tri_v2.0

First Aspect wrote:

Greg66, LiT.....I am disappoint.

Real?

We aim please.

dhope

lost_in_thought wrote:

There's one of those laws, like sods law, or murphy's law, or godwin's law, that states that however much storage you have, your stuff will expand to use it all up.

I think it's that however little you earn, someone will always resent you for it.

EKE_38BPM

dhope wrote:

lost_in_thought wrote:

There's one of those laws, like sods law, or murphy's law, or godwin's law, that states that however much storage you have, your stuff will expand to use it all up.

I think it's that however little you earn, someone will always resent you for it.

And however much you earn, you will inflate your 'needs' to use it all.

W1

Good thread, I've not got a lot to add, it seems like all the bases are covered.

I just wanted to quote this:

MaxwellBygraves wrote:

'Rich people want to get even richer' - hardly a shocking headline!

I find it hard to justify why anyone should even earn that amount of money, nevermind why they should have to pay tax on it! Doubtless that several of the regular contributors will disagree with me, and that is fine, but I find it difficult to ignore the fact that so few have so much when so many have so little. Surely we should do more to adress the vast gap in wealth.

...as a great example of "envy politics". I would love to know what Maxwell does so that I can dicate how much he can earn.

gtvlusso

I don't really give a crap about the 50p tax rate.

What concerns me more is that it has shown that a few individuals have an awful lot of power and influence, and that they have the ear of the government.

The media stir only appears to have been created by a few people who are unhappy about this tax. However, the rest of us, just shut the f*ck up and pay it.....

notsoblue

gtvlusso wrote:

I don't really give a crap about the 50p tax rate.

What concerns me more is that it has shown that a few individuals have an awful lot of power and influence, and that they have the ear of the government.

The media stir only appears to have been created by a few people who are unhappy about this tax. However, the rest of us, just shut the f*ck up and pay it.....

"The rest of us" who have to pay it is about 1% of the population though. So thats probably why most people don't give a crap about the 50p tax rate.

gtvlusso

notsoblue wrote:

gtvlusso wrote:

I don't really give a crap about the 50p tax rate.

What concerns me more is that it has shown that a few individuals have an awful lot of power and influence, and that they have the ear of the government.

The media stir only appears to have been created by a few people who are unhappy about this tax. However, the rest of us, just shut the f*ck up and pay it.....

"The rest of us" who have to pay it is about 1% of the population though. So thats probably why most people don't give a crap about the 50p tax rate.

Ultimately - why don't those few take a bit of pride that they are paying more than there share for the benefit of the country and for the benefit of those less fortunate (lets not forget that tax money also goes towards feeding starving kids and so on).

Hence my, 'stop whining and get on with it' stance'. But I guess some people just want to be able to buy more useless sh1t than anyone else......