Scrapping the 50% Tax Rate!

Hetairoi

Well-Known Forumite
It is likely that the 50% tax rate for those earning over £150,000 will be scrapped in the budget!

We all know that the Tories don't give damn about the working class and are only interested in making the rich richer but do they have to be so obvious about it?
 

shoes

Well-Known Forumite
Who cares anyway, it's not going to make a massive difference to us and frankly people who have worked their way up to that level deserve it. Why should those that achieve disproportionately support those who don't?
 

Lucy

Well-Known Forumite
I'm not sure I agree everyone who has it deserves it, however I think it's more down to the fact that there is a lot of tax avoidance going on. Cutting out tax avoidance is good for everyone.
 

ExiledInStaffers

Well-Known Forumite
It's a tax that simply does not work and long term will have a negative impact on the country. People who are in favour of this sort of thing are just jealous; it's politically motivated and always was. A cheap vote winner for the uneducated poor. Due to globalisation/the internet, etc, etc, businesses can choose where to base their operations. In effect, individual countries, with their own tax regimes etc are competing in a giant market place and we need to be competitive. An uncompetitive tax rate will make it hard for companies to attract executive/senior managers and therefore will choose to setup their businesses elsewhere. Therefore not creating jobs, not investing in the country. It barely raises any tax, and in fact studies have shown that removing it will simply mean more high paid jobs are created, of which more people will pay indirect taxes (20% VAT on the new Ferrari etc) which will more than cover the shortfall and then some more.

Bear in mind, in this country, once you become a "top rate tax payer" (well middle rate I suppose these days, something like 42k a year, excluding benefits), for every additional pound you earn, the government will take 51p (40% Income tax and 11% NI) Every single pound YOU earn, more than half is TAKEN by the government. How can that be fair? How does that encourage people to advance in their careers, to be ambitious? What's the point of working hard towards that bonus knowing you will only ever get half of it? And 42K a year is barely enough money to get a mortgage together on a house in Stafford. Compared to living costs, it's not really that much!

We need to slash government spending, we need to cut taxes. We need to put money back in peoples pockets so they can spend and get the economy going. Reducing the top rate to 45 p in the pound is a start but we need more than that. Raise the tax free allowance, give tax incentives to firms offering private health care, lower the higher rate tax to 30% from 40%. Small government+Low Taxation=Economic growth.
 

shoes

Well-Known Forumite
I'm not sure I agree everyone who has it deserves it, however I think it's more down to the fact that there is a lot of tax avoidance going on. Cutting out tax avoidance is good for everyone.
Agreed, not everyone, but I would wager the majority do. Even if you're not particularly good at your job, if you've managed to blag your way into a favourable position that's surely worth something ;)

I'm 50/50 about tax avoidance, I think we should curb it to a degree but some channels should be left open otherwise the rich, who spend a lot of money here, will just up sticks and naff off.

I don't think taxation income is the biggest problem with the country, it's the way we hemorrhage it that is the problem.
 

ATJ

Well-Known Forumite
And 42K a year is barely enough money to get a mortgage together on a house in Stafford. Compared to living costs, it's not really that much!

I suspected you were joking, and only satirising the Tories, and this line sealed it for me! Well done sir!
 

andy w

Well-Known Forumite
There are a lot more people than ever paying the higher rate of tax. I know a few at my place who work shifts and do overtime who will start paying the higher rate of 40%. There is two ways of looking at it, you could say they are earning good money so they should pay a higher rate of tax, on the other hand you could say they are working long unsocialable hours to support themselves and their families and why should the government have the right to take so much money off them.
I think that is near impossible to come up with a tax and benifit that everyone agrees with. Personally I would simplify the system,raise the starting rate of paying tax, make all benifits taxable, restrict tax relief to the basic rate.
 

henryscat

Well-Known Forumite
Who cares anyway, it's not going to make a massive difference to us and frankly people who have worked their way up to that level deserve it. Why should those that achieve disproportionately support those who don't?

I'm not sure "deserve" is the right word for a lot of them. You pre-suppose that everyone has the opportunity to earn huge salaries: they don't. It is an economic impossibility in a market economy.
 

tek-monkey

wanna see my snake?
Much as I hate the tories, taking half of your earnings over a certain point in tax is a piss take. You get taxed again when you spend it too, and if you save it, it kinda makes it pointless working in the higher paid jobs unless they are a lot higher paid.

I am much more concerned with the raising of the tax free threshold, if only to get rid of the pointless bureaucracy of taking money from the poorest then giving it them back in tax credits. This cost could easily be swallowed by stopping Tesco and Vodafone ****** us over by not paying their taxes, not that I expect that to happen.
 

tek-monkey

wanna see my snake?
I'm not sure "deserve" is the right word for a lot of them. You pre-suppose that everyone has the opportunity to earn huge salaries: they don't. It is an economic impossibility in a market economy.

The brightest will move to the top, or stop at a level they enjoy. If nobody will pay you what you feel you are worth then go self employed, if that isn't possible you may have over-inflated ideas about what you can do. Obviously who you know helps too, I'm a council estate scummer who went to an ex polytechnic but still got a load of jobs through people I met there.
 

tek-monkey

wanna see my snake?
Interesting interview just then, some tory bird (I assume) justifying the tax drop while a labour toad criticises it. The toad was asked if his party would reinstate it if they get power back, he wouldn't answer it.

I think the person not doing much partially off screen was a lib dem, preparing for his parties future.
 

tek-monkey

wanna see my snake?
Live budget update:

Cameron looks smarmy, Clegg looks bored and uncomfortable. Some words have been said, but my BS filter blanked them out.
 

wizzard

Well-Known Forumite
I'm not sure I agree everyone who has it deserves it, however I think it's more down to the fact that there is a lot of tax avoidance going on. Cutting out tax avoidance is good for everyone.

You mean cutting out tax evasion. Tax avoidance is perfectly legal, why pay more tax than you should?
 

Hetairoi

Well-Known Forumite
In an ideal world we could afford to reduce the top level of tax but this is far from an ideal world!

These people are earning more in a year than I will earn in ten years, I would love to be in the position to pay 50% tax!

It is nonsense to say that we have to reduce tax levels to keep the best people in the country, if all they care about is money then I say let them go!

In the end most of us pay over 50% in taxes when you take into account income tax, NI, VAT and all the stealth taxes like tax on petrol, alcohol etc.
 

tek-monkey

wanna see my snake?
I don't understand rich person taxes, but are you taxed in the country you reside in for earnings rather than the country they were earned in?
 

dangerousdave

Well-Known Forumite
there's a growing disparity in income, savings and cash between those at the top and those at the bottom. the general idea of the 50p tax rate to try to combat this is a good thing in theory, but in practice it doesn't work due to a number of things, primarily the ability of those at the top to use loopholes to avoid tax, and (some of) those at the bottom not knowing what work is, and being allowed to be like this due to an overly generous welfare system. in all honesty there's more important issues relating to tax than the 50p rate (the tax evasion by conglomerates like vodafone as aluded to earlier), but i actually fear that the tories are allowing people to get angry about the scrapping of an innefective and costly way of recouping tax to shift the gaze away from these problems
 

tek-monkey

wanna see my snake?
Why does anyone really care about the 50% tax rate, when the 3p rise on fuel duty will **** you all over a hell of a lot more? Its all smoke and mirrors, concentrate on what everyone knew the tories would do and hide the real tax bombshells. The 40% bracket is dropping too I see, that alone will cost anyone on over 40k an extra £200 a year.
 

70-plus

Well-Known Forumite
In order to get the economy moving, we all need to have more money in our pockets. Why give the rich an extra £10,000 - they will only spend it on the Riviera or the Caribbean. I say drop the VAT rate and the tax on petrol so that we can all have a bit of extra money to spend. The economic growth in this country is going from 0.7 to 0.8 per cent. Big deal....
 

tek-monkey

wanna see my snake?
What they should have done was offer every adult in the UK a share of the bank bailout money, in loan form. 20k each at maybe 2% interest, let everyone pay off a chunk of their debts and therefore have much more money to spend moving forward. I'd rather they made it so that it had to spent clearing debt first though, a bit like a sensible version of ocean finance debt consolidation. That would have fixed the banks too, and everyone would be better off.

EDIT: Or scrap income tax completely, and only tax money spent or taken out of the country.
 

henryscat

Well-Known Forumite
It's a tax that simply does not work and long term will have a negative impact on the country. People who are in favour of this sort of thing are just jealous; it's politically motivated and always was. A cheap vote winner for the uneducated poor.

It's eff all to do with jealousy. Explain the justification for the majority of wealth being concentrated in a small minority.


Bear in mind, in this country, once you become a "top rate tax payer" (well middle rate I suppose these days, something like 42k a year, excluding benefits), for every additional pound you earn, the government will take 51p (40% Income tax and 11% NI) Every single pound YOU earn, more than half is TAKEN by the government. How can that be fair?

Because higher earners are more able to pay. Taxes get spent on public services which benefit everyone


We need to slash government spending, we need to cut taxes

It isn't working.

Reducing the top rate to 45 p in the pound is a start but we need more than that. Raise the tax free allowance

So the personal allowance has been raised. But what is given with one hand is taken with the other. Including pensioners who have just been stuffed in the Budget.

give tax incentives to firms offering private health care,

Why? To what advantage?

Small government+Low Taxation=Economic growth.

Ireland had a low tax regime... They're economy is a raging success now isn't it?
 
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