France abandons 75% tax rate

TG – that’s you, you worked hard. Lots of other people work hard, and get paid far less.

There are plenty of sound arguments why taking higher propositions from higher earners is neither morally or legally better

Let’s turn this one around. The corollary to that is that there are plenty of sound arguments why taking lower proportions from low earners is neither morally or legally better.

But those high wages still pay lots more in tax, even if the percentage is no higher than someone on £40k…?

They do, yes. However, the amount of tax you levy on wages has an impact on what wages are paid and why. Piketty is also very interested in the tendency of wealth to concentrate, and the tendency of large concentrations of inherited wealth to out-perform working as a source of income.

Essentially, the case is that you need to redistribute quite a lot (even of earned income) if you don’t want a sclerotic society based on inheritance. That’s a rather bigger argument than one which is just about balancing the books however.

🙂

Mol – what has effort to do with it? A little yes because it affects the supply of labour. But it is supply, and demand not effort that determines wages.

Aracer – there are different ways of arguing justice or what should we do, that is all I am saying. It is not correct to argue that one is morally superior in my mind. They are just different

There are plenty of sound arguments why taking higher propositions from higher earners is neither morally or legally better

Putting aside what may or may not be “legal” or “moral” and focusing on what may be practical, I direct your attention to the opening post. The French tried this and it didn’t work.

Their high net worth earners are fleeing the country and their economy is (not surprisingly, except for perhaps the most fervent believers in the Magic Money Tree) down the crapper.

[list]Anyway far more worrying than France’s barmy tax policies is the fact the Germany looks closer to slipping back jnto recession. Dreadful industrial production figures today.

The French tried this and it didn’t work.

Did they abandon it then? 😉

I have always liked the bar stool economics[/url] view of why tax breaks always err towards the rich and why we shouldn’t tax too highly (Perhaps I should have sent it to François Hollande ?)

Simplistic I know and it doesn’t cover all situations – but I think it poss covers France quite well at the moment

there are different ways of arguing justice or what should we do, that is all I am saying. It is not correct to argue that one is morally superior in my mind. They are just different

Yes, but it seems a lot more defensible when you put it your way rather than mine.

Putting aside what may or may not be “legal” or “moral” and focusing on what may be practical, I direct your attention to the opening post. The French tried this and it didn’t work.

Except they still have a progressive taxation system, which is what THM is actually suggesting there are arguments against. We also have a progressive taxation system which does (by some measures) work.

Can I just check, are we simply arguing over how high the upper tax rate should be set to maximise revenue, or are there others who have an ideological stance on this (such as that progressive taxation is a bad thing – tell us how you really feel THM).

Not putting my way – merely articulation another way. Kept my way out of it for now.

Bad idea on tax threads!!!

Because It’s not for you to decide that 50k is enough, do you really not see that?

Surely it is exactly us, as in society, to decide exactly this. There is no higher absolute authority, unless you’re expecting God to appear with new tax bandings?

Their high net worth earners are fleeing the country

Got any stats on how many? You might recall the threatened mass exodus from the City with the 45% tax rate that turned to be a handful of people who actually left…..

A salutary lesson.

It’s not as good as “Consider the lilies”, tbh.

tell us how you really feel THM

Especially if it is – to quote – a moral issue.

Not putting my way – merely articulation another way. Kept my way out of it for now.

Well it was what you wrote in your post – are you trying to attribute it to somebody else?

If you prefer then: it seems a lot more defensible when you put it the way THM wrote in his post rather than mine.

I am OK with progressive tax with a sensible maximum threshold. Ideally around 30-35% however as we are in dire straits currently 40% seems bearable.

I’d prefer a flat rate system that had a single no tax band then a straight 25% over that. Mainly because it would save a fortune in admin and I believe it would mean less evasion and avoidance and resources would be freed up to pursue corporate and other major tax streams worth far far more than personal tax.

Because It’s not for you to decide that 50k is enough, do you really not see that?

Simple maths – A person earns 250k and pays 10% tax = 25k tax paid
A person earns 25k and pays 10% tax = 2.5k tax paid.

One is paying 10 times more than the other, seems really simple to me.
You do know what the point of a % is – it is to make us pay the same amount – you cannot ignore the % part of your % tax system when claiming one pays more
They do not they pay the same – 10 %
It is a really disingenuous point to state that and abuse of the numbers

FWIW you could do 10 % for 25 k and the 1.01% and your 250 k person still pays “more”
I think you would struggle to convince folk of the simple maths fact that the later pays “more”.

it would mean less evasion and avoidance

higher drinking threshol and faster speed limits would also reduce criminality on the roads but only in tax do we bend to the will of the amoral rather than enforce the law.

Ok OTT but you get the point.

Flat rates favour the wealthy as they pass the tax burden to the “squeezed middle ” [ assuming we have a 10 k + threshold

Of course they pay more 2.5k is 10 x less than 25k. You’re the one being disingenuous. At what point has a person contributed enough or is there no limit to how much they should pay? It’s also highly likely that high earners are using significantly fewer public services except, it would seem, those based in the tax office.

At what point has a person contributed enough or is there no limit to how much they should pay?

You’re suggesting an upper threshold on total tax paid, ie a 0% upper rate? 😯

t’s also highly likely that high earners are using significantly fewer public services

Your issue is actually people not getting back what they’ve paid for then? Presumably as the poor use more public services they should pay more?

Progressive tax rates, ie higher rates on higher incomes are pretty much universal even in Hong Kong and Singapore where the top rates at 15% and 20%. What this does is create a situation where the well off pay a disproportionately large portion of the tax burden. Many here seem to believe the “rich don’t pay enough” but in the UK the top 1% pay nearly 30% of the income taxes. We already have a progressive tax system where the less well off have public services and welfare provided by others.

I see lots of comments above which concern me, statements like whether someone has worked “hard enough” for that extra £100k or whether it is fair they get paid so much. Those are impossible concepts to judge or to get any consensus on.

What we have to have, as @molgrips says, is a tax system which pays the bills. You can talk fairness all you like but if in trying to artificially create this mythical fairness (which frankly is like trying to find the Holy Grail) by redistributing wealth via the tax system you actually shrink the pot that’s bad for all.

Those are impossible concepts to judge or to get any consensus on.

I earn (roughly) £8.50 an hour as an auxiliary nurse… let me think about it. 😈

The point being: you don’t have to be an unreconstructed commie to view, say, the stratospheric rise in CEO pay as being entirely out of step.

Of course they pay more 2.5k is 10 x less than 25k

they also earn x10 less ergot they pay the same %.
You cannot ignore the % in a percentage based tax system and pretend your argument is not disingenuous.

In your view 1.01 % @ 250 k would still be them paying more than the person paying 10 % as this number was the highest – few would agree with your assessment.

is there no limit to how much they should pay?

There is no higher limit – are you really suggesting that say after £250 k tax they get all the rest ? Really ? No tax and yet poorer people have to pay tax
😯

@noteeth – sorry to be very controversial here (for the purposes of the discussion) but a fair society is one where you have freedom of choice for what you do for a living, I imagine you could have got into other lines of work which pay more ? That is a different question as to whether you are paid enough of course, wendyballers get paid a hell of a lot for kicking a football/opposition. The NHS has a budget of £130bn perhaps you can argue it should be distributed differently. Our tax system does protect you with a tax free amount before you start paying tax and you have access to all the other facilites like education, health care and if you need it welfare support in the same way as someone earning a lot more.

EDIT: Free movement of labour and offshore manufacturing have undermined wages at the lower end. That CEO is being paid a lot and in fact he’s paying more tax for the same £1 than you would pay if you received it which is arguably “better for the country”. You cannot fix pay differentials via the tax system. Do I think £8.50 an hour for an auxiliary nurse is too little, yes I do. However if you try and fix that by raising taxes on the “rich” what I fear you’ll do is cut the size of the pot for all.

all wages do is show why the laws of supply and demand are a bit crap and less than perfect.

Footballers paid 300k per week whilst carers get the MW for unsocial shift work and weekend work- we can all explain it but I imagine none of us want to justify it [ bound to be someone who tries]

a fair society is one where you have freedom of choice for what you do for a living

Of course, I agree entirely – I’m not bemoaning my choice of career (or even, tbh – the pay… having days-off midweek & riding empty trails is the pretty much the best compensation ever). But the “justification” for stellar salaries is often, in my view, very weak & rarely stands up to scrutiny – not least the brightest-and-best BS that gets slung around. It’s not simply a matter of shrugging one’s shoulders and claiming that it is impossible to get a consensus on these things – the relationship between effort/supply/demand in executive pay is utterly borked.

You’ve just made an extra £50k FFS
But you may have earnt 1,000,000 extra for your company, hence the bonus. Then as well as paying their liability on your bonus, they’ll be taxed on that extra million profit, too.
😯

Who says it’s not for me?
Whoops! Me, I won’t vote for you, in anything other than the STW whingey leftite competition and even then, I’m not sure you’d win, you’ve plenty of stiff competition.
😉

Instead of robbing the rich, think of it as not robbing the poor, and it makes much more sense.
So you’re still missing how having the rich around, actually helps the poor, who all need jobs. The Rich contribute to an economy in some mysterious way other than paying lots of tax, or leave, as we’ve seen in France. How many Lamborghini sales men have you ever employed? I’d love to employ one for a day, but I can’t afford a Lamborghini.

I’m not a wealth-hater, all I want to do is make sure the lower and middle incom brakcets are well looked after, and public services are good.
Pick one! As funding better public services, by its very nature, is a direct drain on my income at source, ie, tax. Furthermore, if you ( and me) want better incomes for the lower and middle income brackets, then surely this is the burden the employer / shareholder should face by paying correct wages, rather than have those wages subsidized with tax payer £s.

TG – that’s you, you worked hard. Lots of other people work hard, and get paid far less.
Bet most of the people on that 1:05am train weren’t still in their office clothes from the previous morning though… There’s working hard and there’s having no life and probably shortening whatever life you might have. Working like that. So why no a bonus.

I asked a question I did not suggest anything. It seems to me that if a millionaire is paying several hundred thousand in tax, perhaps also owning businesses doing likewise and then, through their spending, adding more revenue through VAT that they have made an adequate social contribution. My question was rhetorical, tax is for making provision of shared services and providing social security so at some point someone will have paid more than enough toward the general good. To then take their money because “they can afford it” is what thieves say..

at some point someone will have paid more than enough toward the general good to take their money because “they can afford it” is what theives say..

At which point, the continous tax grab becomes a morally questionable activity.

Except they still have a progressive taxation system, which is what THM is actually suggesting there are arguments against. We also have a progressive taxation system which does (by some measures) work.

There are for some. We do indeed, but it is overly complex and inefficient to run. Needs major reform.

Can I just check, are we simply arguing over how high the upper tax rate should be set to maximise revenue, or are there others who have an ideological stance on this (such as that progressive taxation is a bad thing – tell us how you really feel THM).

The first thing “may be” setting the rate at a level where you will maximise revenues. This is not ideology it’s mere practicality. As discussed above this depends on tax income elasticity (e) and there it is difficult to calculate with precision. In the UK it is between 40-50%.

yes you did hence why we both got your position correct – deductive logic innit.

at some point someone will have paid more than enough toward the general good to take their money

Can I assume this is your answer and it was exactly what aracer and myself said
Given that why did you bother with that tone and start?

because “they can afford it” is what theives say..

I would say they dont need the money – do thieves say that as well?
You are just being emotive now.

So Proudhon was wrong property is not theft but taxation is ..you are the tea party and I claim my sarah palin memorable flag sticker pack.

Mol – what has effort to do with it?

That’s my point.

I am OK with progressive tax with a sensible maximum threshold. Ideally around 30-35%

Wait, I thought it wasn’t for any of us to decide?

Simple maths – A person earns 250k and pays 10% tax = 25k tax paid
A person earns 25k and pays 10% tax = 2.5k tax paid.

It’s about affordability. 25k from a person earning £250k is peanuts, but £1000 from a person earning £10k is much more onerous.

We do indeed, but it is overly complex and inefficient to run.

Are you seriously suggesting the presence of a higher tax band is what makes it complex and inefficient? Don’t talk rubbish. Tax allowances are far more complex, but you aren’t arguing for the removal of those are you?

It’s an emotive subject. You’re claiming that it is fair to tax the wealthy at a much higher rate than others. You further suggest that arbitary decisions can be made as to how much wealth is appropriate for a given individual.

I disagree. Aligning me with Sarah Palin, really?

It’s about affordability. 25k from a person earning £250k is peanuts, but £1000 from a person earning £10k is much more onerous

Despite quoting me in the same post you ignore the sensible theshold I mentioned. I do not agree a 10k earner should pay tax.

As to 25k being peanuts,it’s still 10x more than the other person in my example.

It’s about affordability. 25k from a person earning £250k is peanuts, but £1000 from a person earning £10k is much more onerous.

While not sticking to the original example given. Based on personal experience, I fear that 25K may be a significant way short of what Mr/Mrs 250K would actually pay, here in the UK.

Does anyone actually have a reasonably judged figure, total payable take in the UK for 250K?

Might I make a small modification to:

at some point someone will have paid more than enough toward the general good to take their money because “they can afford it” is what theives say..

towit:

at some point someone will have paid more than enough toward the general good. To take their money because “they can afford it” is what thieves say..

Are you seriously suggesting the presence of a higher tax band is what makes it complex and inefficient? Don’t talk rubbish. Tax allowances are far more complex, but you aren’t arguing for the removal of those are you?

+1 – it’s not the tax system being progressive which makes it complex and inefficient – that’s all the allowances for various things, where the tax system is used to attempt to modify people’s behaviour. Not really what the tax system should be designed to do IMHO. I am unconvinced that having more than one tax band in itself makes a huge difference to the cost of administering the system nor that it makes evasion and avoidance more likely.

In the UK it is between 40-50%.

That’s a pretty definitive statement. Not 51% or 52% then? So you reckon the current upper rate is too high?

klumpy – Member
Might I make a small modification to:

at some point someone will have paid more than enough toward the general good to take their money because “they can afford it” is what theives say..

towit:

at some point someone will have paid more than enough toward the general good. To take their money because “they can afford it” is what thieves say..

YIPPEE!!! We’re all going to Live!

I already had! Typo on my part.

You’re claiming that it is fair to tax the wealthy at a much higher rate than others.

Let’s do this again. I’m claiming that it’s fair to tax the poor at a lower rate than the wealthy. Is this something you disagree with?

You further suggest that arbitary decisions can be made as to how much wealth is appropriate for a given individual.

Arbitrary decisions have to be made. Of course it won’t be absolutely “fair” for everybody, but I don’t think most sensible people would dispute that a progressive tax system is more fair for more people than one which isn’t.

That’s a pretty definitive statement. Not 51% or 52% then? So you reckon the current upper rate is too high?

Yes. And not just me, that is where the current analysis suggests. It’s all available online 😉 even at the HRMC

Are you seriously suggesting the presence of a higher tax band is what makes it complex and inefficient?

No so don’t suggest this. I do know that we have an overly complex and inefficient tax systems in the UK that serves it’s purpose poorly. Google Mirlees Report.

Don’t talk rubbish.

Cheers I am not. Nice and polite BTW.

Tax allowances are far more complex, but you aren’t arguing for the removal of those are you?

You tell me, you seem to enjoy saying what I am saying and not saying!

Let’s do this again. I’m claiming that it’s fair to tax the poor at a lower rate than the wealthy. Is this something you disagree with?
Nope….. But where do you stop hittin-up the Riche.

No. I agree, to a point.