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Google income and substitution effects then mol....
The explanation in the Mirlees Report is well worth reading as this relates these effects to (re)distribution too. compared with a lot of economics, tax design is actually quite interesting especially the behavioural aspects
Some will not like his explanation of how a flat rate tax can be progressive but never mind - teach a man to fish....
People don't seem to able to grasp the extent we where outspending our earnings under Labour. It's quite scary how much people believe that was normal and to cut spending from those levels is austerity.
[url= http://news.bbc.co.uk/1/hi/uk_politics/6975536.stm ]Osbourne agreeing to match Labour spending plans pre crash[/url]
Nice attempt to re write history
The economy collapse caused the mess and no one foresaw it. Most folks think that to have balanced the books would have done more harm than good, hence the slow cut [ and even the tories doing it slower than they said they would] rather than a slash and burn approach to balance the books.
Some still use it as a stick,for entirely political motives, to beat labour
Austerity = living within your means
is it living within your means to have a mortgage or is it reckless borrowing to live outside ones means?
Google income and substitution effects then mol
I have.. still not sure what you're getting at though.
That doesn't really make sense, you are basically saying it's alright to be a **** as long as you declare you are a ****! 😆 It's not alright!ernie_lynch - MemberI don't blame the Conservatives for behaving like I would expect them to behave.
I edited the post with the link - these effects explain how people react/what happens when you change the tax rate. How they balance and how they need to be taken into account when thinking about redistribution of income and tax design. joking apart, it is actually very interesting as is working out the optimum marginal rate of tax. (its not 50% BTW)
Hmm.. but does it take into account people's perception of the value for money they get from taxation?
Austerity was designed to address other things.
Austerity [b]in itself[/b] is unlikely to increase growth, why? Because it involves cutting spending and/or raising taxes both of which are withdrawals from the economy. They both reduce aggregate demand.
No (at least not directly, yes indirectly) they relate to the supply of labour and the change in the tax rate.
just5minutes - MemberWhat, like the top 1% now paying 30% of all tax and the top 14% of earners now paying 62% of tax?
Top earners are paying substantially more now in real terms than they ever did under Labour...
https://fullfact.org/factchecks/income_tax_are_the_top_1_really_paying_more-29302
According to this- while the top 1% are paying more tax, their actual proportion of tax is unchanged since the 1980s. In other words, if correct, the increase in tax they pay is because they're richer, not because they're paying proportionally more tax.
The top 1% pay 30% of income tax, but the bottom 50% pay 10%. The top 1% have average earnings of £248,000. The bottom 50% have average earnings of, I think, about £17000. (*) So the top 1% pays proportionally 3 times more income tax on average while earning 14.5 times more on average
(* I've little confidence in this number. So let's run it again with a dependable number. The 5th percentile income is about £22000. The average of the bottom 50% can only be lower than this, but it gives you 11 times instead of 14.5. The actual figure may well be worse than 14.5; it can't be better than 11)
Anyone see any issues with these numbers? Strikes me as a much more reasonable way to look at this than "1% pays 30%" which ignores actual incomes and take-homes.
Dont you be bringing facts into this NW remember the rich are what we depend on as they are admirable creators of wealth and if we try to tax them these noble folk will just leave and/or avoid tax 😕
Remember unequal income distributions are natural and normal
High rates of tax are both unfair [ they [pay so much already] and will get you less money
[i]I just don't get this argument at all. If I was on £50k a year, had the opportunity to go for a £150k a year job, because I'd 'only' get an extra £40k a year in my pocket, would I say no? Would I hell. You still get more money - just not all of it.[/i]
Not quite as simple as that. No one is going to offer you three times more to do the same job, you would need to be taking on potentially: more responsibility/more stress/more hours/more grief. Some would say they'd rather have a considerably easier life on £40k less. (Ask Junky!)
NW - don't forget that they are not the same people!
How many people are motivated to work harder or create businesses when they will have to give up 60% of what they earn in tax?
Apparently, to get the wealthy to work more, you have to give them more, and to get the poor to work more, you have to give them less.
That is the Tory way. The tories and their voters are an affront to Human decency.
Watching IDS on Andrew Marr re-enforced my hatred of all things Conservative. Sometimes watching Davieboys matey bonhomie its possible to forget just what a bunch of heartless shitehawks the majority of them are.
Their heartlessness is neatly summed up by the Bedroom Tax in three easy steps
1. Penalise social housing tenants for living in houses larger than they need when no smaller houses are available.
2.Introduce a policy that causes hardship and anxiety for hundreds of thousands of people that saves virtually no money
3. Don't build any new social housing
A fabulous wheeze I'm sure you will agree, no doubt the further £12bn in welfare cuts will involve some more jolly japes. Although like the loveable joker he is IDS wasn't willing to spoil the joke by telling us what his actual plans were
From the ONS
•Before taxes and benefits the richest fifth of households had an average income of £81,300 in 2012/13, almost 15 times greater than the poorest fifth who had an average income of £5,500.
•Overall, taxes and benefits lead to income being shared more equally between households. After all taxes and benefits are taken into account the ratio between the average incomes of the top and the bottom fifth of households (£59,900 and £15,600 per year respectively) is reduced to four-to-one.
•Fifty-two per cent of households received more in benefits (including in-kind benefits such as education) than they paid in taxes in 2012/13. This is equivalent to 13.8 million households.
•The average disposable income in 2012/13 was unchanged from 2011/12, but it remains lower than at the start of the economic downturn, with equivalised disposable income falling by £1,200 since 2007/08 in real terms. The fall in income has been largest for the richest fifth of households (5.2%). In contrast, after accounting for inflation and household composition, the average income for the poorest fifth has grown over this period (3.5%).
•There was a slight increase in income inequality between 2011/12 and 2012/13, based on some inequality measures. Despite this, income inequality is broadly unchanged from other recent years.
edit: the bedroom what?
I'm intrugued to find out where Jeremy Hunt thinks he's going to find more than £22bn in efficiency savings in the NHS...
edit: the bedroom what?
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edit: the bedroom what?
You can call it the "abolition of spare room subsidy" if you like.
The point still stands unchallenged
No wonder the SNP have such an easy time of things, if folk fall for that! Nice new mirror BTW!
THM - what are your thoughts on the living wage?
Just increased all my interns up to it, why?
I'm just interested to know what you think of the living wage.
richmtb - as well as the thing they love more than anything - punishing the poor for being poor, theres also the delightful wheeze of punishing the disabled for being disabled. Another ideologically driven piece of nonsense that has caused untold misery to some of the most disadvantaged people in society. It was meant to save billions. Its actually saved the some total of * all.
Mrs Binners works with disabled charities, and its absolutely scandalous what the Tories have done. The whole ATOS evaluation thing was expressly designed to get genuinely disabled and sick people off benefits, with not a care as to what impact that would have on their lives! While the whole process has been a massive farce, Its had a massively detrimental effect on some of the most vulnerable member s of our society, who are being forced to jump through increasing numbers of hoops just to live.
I *ing loath IDS and his (typically Tory) lofty, uncaring arrogance. A truly vile human being!
[quote=PJM1974 ]
..and back in the real world how do you suggest funding the gap?
Don't understand the point you're making here.
I presumed you were suggesting funding the gap between income and expenditure by stopping people avoiding tax - apologies if that wasn't the case and your mention of tax avoidance was nothing to do with the post you quoted.
Depends on at what level it is set and the elasticity of demand and supply for labour. So need a little bit more info....
You cannot answer yes/no, like/dislike etc
[quote=binners said]The whole ATOS evaluation thing was designed to get genuinely disabled and sick people off benefits, with not a care as to what impact that would have on their lives!
The ATOS evaluation thing that New Labour introduced ?
[quote=Northwind ]The top 1% pay 30% of income tax, but the bottom 50% pay 10%. The top 1% have average earnings of £248,000. The bottom 50% have average earnings of, I think, about £17000. (*) So the top 1% pays proportionally 3 times more income tax on average while earning 14.5 times more on average
Well there are 50 times as many people in the bottom 50% as in the top 1%, so cumulatively the top 1% earn 0.3 times what the bottom 50% do, yet pay 3 times as much tax. Nothing wrong with that, but it shows that the point you seem to be trying to make is incorrect. If I've understood correctly the point you're trying to make - which may not be the case!
It seems that on the first day of electioneering, the tories have been a bit fast and loose with their claims, at least according to the IFS
http://www.independent.co.uk/news/uk/politics/david-camerons-claim-that-labour-would-raise-taxes-by-3000-is-not-sensible-says-the-ifs-10144367.html
But then, when has telling the truth ever been a priority for Mr. Shapps. Apparently when challenged on the figure of £3000 he admitted it was a guess " because Labour hadn't been specific about their plans'"!
Mr Shapps being a bit "over firm" again? I will not forgive him for his abuse of english for a start
Depends on at what level it is set and the elasticity of demand and supply for labour.
I'm not an economist, so you're going to have to explain that to me.
You would have more chance getting a factual answer from an alchemist than an economist.
Well based on MSP's, I wont bother. Other than repeating what I said - you cannot make a comment about the living wage without knowing other facts. But why do you ask?
well worth reading as this relates these effects to (re)distribution too. compared with a lot of economics, tax design is actually quite interesting especially the behavioural aspects
Interesting - possibly. Convincing - not so much. If economists could actually understand complicated non-linear systems they would have figured out how to ruin the country properly. Which they clearly haven't.
DrJ - Member
Interesting - possibly. Convincing - not so much
you decide, its one of the most authoritative studies on Uk tax published recently - your shout.
If economists could actually understand complicated non-linear systems they would have figured out how to ruin the country properly. Which they clearly haven't.
well that's a relief, why would you want them to ruin the country?
plenty of economists saw what was coming (including within the BoE) and many made lots of money as a result
The ATOS evaluation thing that New Labour introduced ?
Yes and it's been pointed out to binners before but that doesn't stop him blaming IDS and the Tories 🙂
It was a bad policy by nu labour, but the tories really turned the screw.
punishing the poor for being poor
The political right, I think, believe that anyone can be rich and successful if they work hard and apply themselves. However the logical inverse of this is that if you aren't rich and successful, it's your own fault....
Yes and it's been pointed out to binners before but that doesn't stop him blaming IDS and the Tories
It was when the tories decided to [i]reassess[/i] incapacity benefit to the people already on it rather than to new WCA claimants in 2011 that the problems really started, so both outlooks have merit-Labour introduced it, IDS made it a lot, lot worse for people.
well that's a relief, why would you want them to ruin the country?
Look ma, a typo flame!
There are various figures bandied around to quantify the loss to the exchequer from tax avoidance. The Guardian reckon £35bn a year
they should know all about offshoring profits after they did it for Autotrader sale proceeds
It was when the tories decided to reassess incapacity benefit to the people already on it rather than to new WCA claimants in 2011 that the problems really started, so both outlooks have merit-Labour introduced it, IDS made it a lot, lot worse for people.
if ATOS is so toxic why is Alan Johnson briefing them about Labours policies?
http://order-order.com/2015/03/30/labour-give-hated-atos-special-accesst-to-plans-for-government/
When labour introduced different testing for the disabled , it was a revised test for new claims, that effected a small number of people. It was IDS and the Tories that decided to force every claiment, no matter how ill, to be reapraised. Putting them on a random conveyor belt of spurious tests, on an industrial scale.
Mrs Binners was working with a disabled charity at the time, and it was ridiculous. They were telling people with severe disabilities, who struggle to cope in their own homes unaided, to show up for random assessments in towns miles away, then stopping their benefits when they failed to show up. And we're not talking about the odd case either.
IDS is a cold-hearted, callous and uncaring ****!!!
A typical Tory really
Yeah, I take everything Paul Staines says at face value. Oh, just remembered, his blog is hosted offshore isn't it?
Michael Portillo went to South Wales on one of his Railway Journeys. He was talking to an ex-miner about the strike, and said something like 'Gosh, I didn't realise it meant that much to you'.
FFS.
aracer - MemberWell there are 50 times as many people in the bottom 50% as in the top 1%
I was working with average individual incomes so I'm not sure what your point is?
My point's fairly simple; the richest people in society do pay more than average earnings, but nothing like in proportion to the disparity in wealth. They're not paying more income tax today because we're putting "more weight on the broadest shoulders"- they're paying more income tax because we're putting more money in the biggest pockets.
jimw - MemberYeah, I take everything Paul Staines says at face value. Oh, just remembered, his blog is hosted offshore isn't it?
I think he is internet troll and can be OTT, as I understand it his blog is hosted overseas to keep it out of the reach of UK litigation
howvever on some issues he is more than happy to go to court, just ask property multimillionaire Emily Thornberry
so are you saying that Alan Johnson isn't meeting ATOS?
I can't forgive the tories for making me feel sorry for Ed Miliband. It would appear the tories are going to fight this election by telling bare-faced lies and launching ever more vicious personal attacks against Miliband. They should be careful, as it could force a lot of ex-labour voters back in to the fold.