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Alternatively, just think what the public might do with all that money the government take off them instead - like spend the weekend mountainbiking in Wales, creating jobs in hotels, cafe's, bike shops, etc. or [b]paying down debt, which is the natural reaction in a recession when handed extra money[/b]
when the government failed to push for global tax reform and sorting out tax havens they lost the battle here. Clegg in particular has failed- we expect our tory part leaders to have inherited a fortune stashed away in a tax haven, they are after all just out for themselves. The libdems were supposed to be different
The point is we all know that the income tax [ it does not show all taxes as i suspect that would drastically reduce the impact as it would be more equal] is designed to redistribute wealth so no one is really surprised to see that the better off pay more – a look at the income tax rates will tell you that.
We all know that many wealthy folk pay a lower rate of tax as a percentage [ please zulu not again] of their income than the "little " people
Its a lovely graph that is designed to have maximum impact and indeed it does.
Hence why I asked what it would look like if they did not avoid tax
What would it look like if you include indirect tax/total tax burden?
It would certainly alter the %
Lies, damn lies and statistics- to be fair it’s a very good chart for the right wingers and it does illuminate a point well
In fair society those that can should pay!
Those that don't want to pay or work should not be treated the same as those that really can't pay for genuine reasons. After all who really cares about those in real need not of the own making, those that seem to shout the loudest are often incapable of differentiating between the two, they reduce he help to those in real need. They are often the same people who think that tax avoidance is illegal. Evasion now that should be criminal with a good sentence to back it up.
Junkyard - without typos, I simply won't believe its actually you thats posting. I've come to the conclusion that you have 7 fingers and 2 thumbs on each hand 😀
The thing with governments is that they waste an awful lot of the taxes they receive and pretty much any one of us could probably Google and find billions spent on something we personally disagree with - whether is benefits, pensions, MP's expenses, Trident etc.
Consequently we all believe that OUR tax is too high and that too little is spent (in certain areas).
And once you get to a point where a payslip shows that your overall deductions are heading to 50%, suddenly you are working for others - not yourself.
@Graham5, bugger! that'll teach me to read more carefully in future!!
I just wonder where "They must pay their fair share" ends. What's fair? I'm by no means loaded but I am sick of the politics of envy.
We have a massive debt and driving out the wealth creators with ridiculous taxation hikes won't help the economy
binners - Member
Blimey! Has the worm finally turned
No, as others have said he has a party conference coming up. Expect lots of sound-bites from Clegg, Cameron and Milliband over the coming weeks together with little, if any, follow-through.
[Nice to see a usually-contentious STW topic debated in a sensible manner. I wonder why? Chapeau les mods, peut-etre?)
Surely income tax is a percentage of income, so those with high incomes do already pay more without the need to introduce higher and higher percentage bands?
Adam Smith:
"The necessaries of life occasion the great expense of the poor. They find it difficult to get food, and the greater part of their little revenue is spent in getting it. The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess. A tax upon house-rents, therefore, would in general fall heaviest upon the rich; and in this sort of inequality there would not, perhaps, be anything very unreasonable. It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion."
I want that on a t-shirt Binners 😉
Gone back to a lap top with a touchpad so i end up with bad spelling and random sentence structure based on where I acidently hit the pad.
Incomprehnsible even to me - there may be a punchline there 😉
And once you get to a point where a payslip shows that your overall deductions are heading to 50%,
Overall tax contributions are higher for poor people than they are for rich people.
Binners! Think you'll find thats me "7 fingers and 2 thumbs on each hand"
Surely income tax is a percentage of income, so those with high incomes do already pay more without the need to introduce higher and higher percentage bands
they only pay more if you ignore the % part of your % based tax system
Nice Adam Smith quite ransos, but isn't that point already addressed by tax free allowances on income?
Even if the income tax rate were completely flat, the higher earners would still pay more* income tax (both as an absolute value and as a percentage of income).
*(provided they didn't avoid it somehow, obviously)
they only pay more if you ignore the % part of your % based tax system
No, assuming (big assumption) that they don't somehow avoid paying the tax, the wealthy would pay more income tax as a percentage of income.
[i]Chapeau les mods, peut-etre?[/i]
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are you doing a flat rate or a flat rate with a threshold?I missed the post and only saw the quote.
The later makes next to no difference unless you use the margins for the very poor and the very rich to make your %. It still remains the case that everyone, who actually pays tax, pays tax at the same rate above the threshold. the % of their income they loose to tax does differ but you would be hard pushed to call a flat rate with threshold as progressive
Its is more a case of where /how you view it but economists[ a right wing bunch presents their opinions as science] term it a progressive system though i personally think that is stretching the point a bit
Nice Adam Smith quite ransos, but isn't that point already addressed by tax free allowances on income?Even if the income tax rate were completely flat, the higher earners would still pay more* income tax (both as an absolute value and as a percentage of income).
Two things:
1. The personal allowance means that the rate isn't flat. It goes a very small way to addressing Smith's argument, which is that because richer people have far more disposable income (in both absolute and percentage terms) it's not unreasonable for them to pay at a higher rate.
2. For very high earners, the personal allowance is so trivial as to be barely worth calculating as a percentage.
Anyway, focussing on income tax is a diversion - it's the total tax take that matters.
are you doing a flat rate or a flat rate with a threshold?
Neither really - just making the point that I agree the whole argument that the wealthy don't pay enough income tax is a bit misguided and disingenuous.
Assuming they don't dodge it somehow, they do already pay quite a lot.
richer people have far more disposable income (in both absolute and percentage terms) it's not unreasonable for them to pay at a higher rate.
But don't they pay that when they [i]dispose[/i] of that disposable income (e.g. VAT on luxury goods)?
focussing on income tax is a diversion - it's the total tax take that matters.
Agreed.
Shut down the loopholes. Simplify the rules to manage tax avoidance.
Collect more tax based on relative household wealth, not income.
relative household wealth, not income.
Oh no, here we go again....!
Oh, hold on a minute. Something's changed...
😉
on the shelf and I've still not read it. tsk tskThe award-winning author of [b]The Curious Incident of the Dog in the Night-Time[/b]
Sorry no political pointscoring to add and my graphs are rubbish.
I agree the whole argument that the wealthy don't pay enough income tax is a bit misguided and disingenuous.Assuming they don't dodge it somehow, they do already pay quite a lot.
Not nearly enough though but I am too the left of [s]you[/s] most people
Shut down the loopholes. Simplify the rules to manage tax avoidance.
Collect more tax based on relative household wealth, not income.
Agreed
But don't they pay that when they dispose of that disposable income (e.g. VAT on luxury goods)?
As I said earlier, the total tax percentage for rich people is less than the percentage for poor people. There are plenty of VATable items we all use (fuel, clothes) that aren't what you would call luxuries.
Oh no, here we go again....!
Oh, hold on a minute. Something's changed...
Yes, I think we can ALL sensibly agree that overall household wealth is THE ONLY sensible measure of wealth. Can't we? 😉
Ooohh... what's that?.. I can hear someone far, far away (in Edinburgh) screaming at his monitor in impotent rage...
VAT on 'luxury' items? Like hot pasties, or gas? VAT is a shocking tax. One that hits the 'poor' far harder than the 'rich'. Indirect taxation sounds neat when people say 'tax consumption'. It sounds less neat when you realize a 0% taxpayer pays a chunk of income in indirect taxation on daily essentials.
As I said earlier, the total tax percentage for rich people is less than the percentage for poor people.
Hmmm.. any figures or examples for that?
There are plenty of VATable items we all use (fuel, clothes) that aren't what you would call luxuries.
Yep, which is possibly a good reason to make VAT variable depending on the goods/services it is applied to.
It already is to a degree: domestic fuel and energy is reduced rate (5%), food, children's clothes and public transport are zero-rated.
But what constitutes overall household wealth?
Total income + property value + savings + pensions (that are already taxed three times and virtually worthless)?
That approach suggests to me if you've provided for yourself then prepare to be punished for doing so. Its time that people bit the bullet and accepted that both the welfare state and the government employment industry (civil service) need radical surgery as they're unaffordable.
Hmmm.. any figures or examples for that?
Not to hand. Have a look on the ONS website for reports on household income and expenditure.
Yep, which is possibly a good reason to make VAT variable depending on the goods/services it is applied to.
Agreed, but how would such a cut be paid for?
at the present rate of tax evasion/ avoidance, yesboth the welfare state and the government employment industry (civil service) need radical surgery as they're unaffordable.
Its time that people bit the bullet and accepted that both the welfare state and the government employment industry (civil service) need radical surgery as they're unaffordable.
it is perfectly affordable what you mean is politicaly you dont like it
Grahams ggod somethingion here froma quick skim read
Like all of this your politcs and your viepoint matter as much as the actual numbers
Basically the poor pay more but the argument is they also get income from the state from whihc they then pay taxes ; they are net gainers but they do pay a higher % of income on tax than the rich
http://www.ifs.org.uk/publications/4813
take your pick
The government could virtually stop all tax avoidance tomorrow, at a stroke, if there was even the slightest shred of will to do it within Westminster, within any of the parties. Which there isn't
Just heap the burden on the 'little people' instead
But what constitutes overall household wealth?
Combined post-tax income versus number of family members weighted by dependency?
As used here: http://www.ifs.org.uk/wheredoyoufitin/
Agreed, but how would such a cut be paid for?
What cut?
Some essentials are already zero-rated or reduced-rate VAT (fuel, food, kids clothes). You could expand that to other essentials while increasing VAT on non-essential luxury items.
Making it cheaper to live life but more expensive to buy luxuries.
The argument would be over what constitutes a "luxury item" (new car, big telly, some white goods) and what is "essential".
[i]You could expand that to other essentials while increasing VAT on non-essential luxury items.[/i]
It already adds a fifth, how much more do you propose to add - and who decides what is essential? To a Vegan meat is not. To a non-driver (and/or city folk) a car is non-essential.
Heated wing mirrors?
It already adds a fifth, how much more do you propose to add
Whatever is required? I dunno I'm not an economist - just suggesting it as an idea. How does another 5% sound and maybe 10% on extravagant luxuries (caviar, yachts, diamonds, heated wing mirrors)? 😉
who decides what is essential? To a Vegan meat is not. To a non-driver (and/or city folk) a car is non-essential.
Aye, there's the rub.
I think basic food and personal travel certainly come under essential.
Some essentials are already zero-rated or reduced-rate VAT (fuel, food, kids clothes). You could expand that to other essentials while increasing VAT on non-essential luxury items.
Not unless we leave the European Union we couldn't...
personal travel certainly come under essential.
what if the person chooses to go by car over public transport or cycling?
what if the person chooses to go by car over public transport or cycling?
Still a basic "quality of life" essential I'd say, given the car-centric nature of our society.
Obviously such decisions would need to reflect a general consensus, not individual circumstance.
Public transport and cycling are lovely - but not that great for a visit to IKEA.
I think basic food and personal travel certainly come under essential
Not sure about the travel, I'd go for food and shelter. Food is already pretty cheap - obesity is more of a problem. So we just need housing costs to drop to about half to a third of what they are now. Now if Clegg would say that I'd admit he's got some balls.
This statement is purely Clegg trying to get some attention after putting tuition fees up to £9k and slashing the budgets of the NHS and the police.
This is a simple statement of "tax somebody else not me I pay enough already"
It's a terrible idea, massively counter productive.
It is a tax on living in the South where the vast majority of higher value homes are located.
The "rich" are already paying substantially more tax than they were 5 years ago, the top 1% pay 25% of the income tax and the top 10% pay over 50%. The "rich" have bought their £2m home paid out of after tax income.
VAT increase on non-essentials .. we used to have two rates of VAT 15 and 25 I recall, when introduced the higher rate destroyed a number of UK industries like yacht building, now we buy boats from France, Scandinavia and Italy for example. We used to have a 10% car tax (plus the VAT) that was removed as it was seen to be counterproductive.
Junkyard - Member
Its is more a case of where /how you view it but economists [a right wing bunch presents their opinions as science] term it a progressive system though i personally think that is stretching the point a bit
JY, reading that made me smile. I admire your restraint in writing it and hope that the lip wan't bitten too hard!! 😉
Public transport and cycling are lovely - but not that great for a visit to IKEA.
ikea offer free delivery if you produce valid bus/tube ticket 🙂
Given the debate above, hasn't Clegg achieved what he wanted, recognition having basically disappeared after the great student fees rip-of, and the PR referendum?
Its a ploy to buy a point or two in the opinion polls, and as the Lib Dems will never get elected again, he can say what he likes.
The extent to which these ideas represent joined-up Lib Dem policies is probably summed up by:
Baroness Susan Kramer, Lib Dem Treasury [b]spokesperson in the Lords[/b], said she had first heard of Mr Clegg’s desire for the tax from the interview in the Guardian and looked forward to hearing the details.
The FT did not include a smiley at the end of this quote. You have to wonder what kind of people are in government these days!