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It's an imaginary rate based on the premise that someone earning 100-120k isn't taxed on the total.
Earn £110,000 in 2015/2016 and you'll take home £69,126.
Over the year you'll pay £35,403 income tax and £5,471 in National Insurance.
It is not imaginary, it is the marginal rate at that income level. For every pound you earn over the margin of 100,000, you will only take home 38p until you get to 120,000.
For every pound you earn over the margin of 100,000, you will only take home 38p until you get to 120,000.
A great way to make a point but quoting the overall % of tax paid is much better (hint it's closer to 36% of your income)
http://www.incometaxcalculator.org.uk/?yr=2016&age=0&time=1&ingr=120000#
62% marginal rate explained here:
[url= http://www.barnesroffe.com/paying-62-tax-rate/ ]Paying 62 & tax rate[/url]
Other pretend stuff available here.
It's not pretend at all - I suspect if you're suggesting that you don't understand the concept of marginal tax rates - and given the discussion was about the incentive to earn a bit more, the marginal rate is a far more useful measure than the overall tax rate.
Note: this post contains no content concerning the morality or otherwise of earning more than £100k (a level I doubt I'll ever get anywhere near)
If you have a business that has fixed costs of £1,000 and income of £2,000 and you are offered a job which will give you further income of £100 for no increase in cost, have you earned £100 for that job or £52.
It is real and it does influence behaviour. It's actually quite common to use the tax system to influence behaviour. High taxes on cigarettes to discourage smoking, tax reliefs to encourage savings (cycle to work schemes to encourage expensive bike purchases). It's just that sometimes it's a side effect rather than desired outcome.