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to hope the government has the guts to tax WEALTHY pensioners more

(954 Posts)
ReallyTired Mon 22-Apr-13 09:12:30

The Fabian society has suggested that wealthy pensioners pay more tax.

www.bbc.co.uk/news/education-22220345

Some how I can't see a conservative wanting to tax wealthy pensioners more when they all vote Tory.

I find it unfair that pensioners with an income more the average family's income get free bus buses, winter fuel allowance, TV licence as well as paying less tax and national insurance. It is about time that the the wealthy pensioners took their share of the pain of the cuts.

I am in favour of well off pensioners having free bus passes, winter fuel allowance as these things encourage independence and improve health. I would like to see the money for these things clawed back by WEALTHY pensioners paying more income tax.

ihategeorgeosborne Mon 22-Apr-13 13:00:25

Sorry, that was to flatpack

Lazyjaney Mon 22-Apr-13 13:02:27

Today's pensioners benefited from the biggest, longest boom in human history. It's over now though, everyone else's lifestyle and benefits are being reduced, but theirs are still running on pre Great Recession expectations.

It's not sustainable as the working population isn't rich enough or numerous enough to pay for it, even before 2008, but the Grey vote is formidable so I think the re- structuring will come later than it should and so be more painfully than it should.

HeadFairy Mon 22-Apr-13 13:07:59

Niceguy I've heard the arguments about the rich leaving the country. Yes I suppose that's a possibility. Quite a few have left already. I'm not entirely sure society would be worse off without them to be honest. I don't really see them as some kind of magical wealth creators. They're quite a financial burden actually. Property speculators have driven housing prices up massively in London. The ripples of that are felt by everyone, but trickle down doesn't seem to have the same effect remembering of course that on the internet a quick Google can produce an article to back up just about every viewpoint you care to think of

flatpackhamster Mon 22-Apr-13 13:10:00

ihategeorgeosborne

Not when you take into account the number of dependants that that money has to look after. It actually puts you in about the 5th decile income group according to the IFS.

When the median salary is £26k, a single-incomer on £50k is rich. Doesn't matter how many dependents.

HeadFairy Mon 22-Apr-13 13:10:08

flatpack A single income of £50k puts that earner in the top 10% by income in the UK. By any metric that makes them 'rich'

Actually I think the real problem is the opposite... a £50k income is in the top 10% by income in the UK because we have a ludicrously low level of pay in this country. Most of our salaries are being cut to give greater pay to senior executives.

nokidshere Mon 22-Apr-13 13:10:40

I dont think pensioners should be charged more than anyone else. My MIL worked full time for 40+ years and paid tax on her money. She saved some so she wouldn't need assistance in her old age and that money was taxed again. She now gets state pension and a private pension and is taxed again. And if she is unlucky enough to need any care she will have to sell her home and pay for it herself.

So not only did she work tirelessly through a war, bring up a family with no money, no goods and no services for a considerable amount of time, but she has also paid tax 3 times on the same money.

And it really makes me laugh when people say they have it harder now - what utter tosh!

In 30 years time when you are all drawing your pensions you will be posting on here moaning about how unfair it all is blah blah.......

handcream Mon 22-Apr-13 13:12:00

I did wonder why they were allowing pensioners to keep their large houses even though their familes are long gone..

However, what about pensioners who have little in the way of pension provision and have a house worth say £400K. Will they be expected to sell their house?

As harsh as it sounds I think if you are now single and over 60 living in say a 3-4 bedroom house you SHOULD have to move. if I lost my job I would have to move.

HeadFairy Mon 22-Apr-13 13:12:18
ihategeorgeosborne Mon 22-Apr-13 13:12:43

flatpack, if you think a single income earner on 50k with dependents is rich, what does that make the same family on 150k? Why are they getting a tax cut?

scaevola Mon 22-Apr-13 13:12:48

"Pensioners pay less tax as they don't pay national insurance."

NI isn't a tax. It's the payment in lieu of payment into an actual pension fund, but in return for which the government pays the state pension. Once you start drawing the pension, you stop paying the contribution. It's exactly the same as any workplace pension in that respect. That it isn't an actual fund, but a promise of a share of general government revenue, was the choice of those who set up this aspect of the welfare state.

And NI is payable only on earnings. Even the working population do not pay it on any non-earnings income, so it's possible everyone could take quite a big hit (eg tax liability of your pension fund - not your personal pot, the actual fund itself).

reallyyummymummy Mon 22-Apr-13 13:13:37

And after you have worked your arse of for 40 years paying tax I am wondering if you will still feel the same on this subject.

sweetkitty Mon 22-Apr-13 13:16:22

Agree that WFA should be means tested like CB now is.

Also agree the HB cap should also apply to pensioners as well.

My aunt and uncle receive WFA but they spend winter in Spain in their second home.

Do you think we will be getting WFA when we all retire, no

jacks365 Mon 22-Apr-13 13:19:16

Handcream so are you suggesting that my parents should be forced to sell their house? A house they have bought and paid for themselves? The only "benefits" they have had in their life are child benefit, free bus passes and wfa. They paid tax all their lives and still pay now on pensions that they also paid for, they are not old enough to qualify for the free tv licence.

ihategeorgeosborne Mon 22-Apr-13 13:19:22

The thing is, none of these benefits will still be available for the current 30 and 40 year olds when we retire. I'm not sure how many of the young to day will survive to be honest when they're pensioners. Many can't afford to buy their own home, so that is another time bomb waiting to happen in 20 or so years time. Politicians are all in it for the short term. They want to win the next election. None of them seem to think about the consequences further down the line. This should not be allowed. They should be made to be accountable for their actions.

niceguy2 Mon 22-Apr-13 13:27:08

I don't think that a single income family on 50k is rich

Completely agree and that is another good reason why we need to tread carefully with the whole 'tax the rich' argument.

Rich by whose standards? To me Simon Cowell is rich. To Roman Abramovich he's a pauper. Same principle here. Many on MN seem to think if you earn above minimum wage then you should shut up and count yourself lucky.

@Headfairy. I can't read the full article in your first link and your last two are generally how the successful are being paid more. I don't think anyone is disputing that. Neither go back to the earlier post you made about cuts are not necessary, nor related to the topic in question which is about wealthy pensioners.

The fact is that we spend just under £160 billion a year on welfare. Out of which £81.3billion are paid in pensions & pension credits. That's over half. So how can any government seriously say they are trying to tackle the welfare bill when ignoring the largest expenditure?

If I am earning £2000 a month, spending £3000 a month and trying to convince you that I am seriously cutting back because I cancelled my Sky subscription would you take me seriously? Surely you'd be expecting me to be looking at my mortgage deal, my utility bills, my food bills?

HeadFairy Mon 22-Apr-13 13:33:26

Sorry if my links didn't work Niceguy not sure what happened there... yes, the rich are getting richer. But I think that's to the detriment of the lower paid. I for example have been denied a pay rise of even one penny for the past 6 years, however a chief exec left recently left with a huge golden goodbye. Apparently there was enough money for her, but not for me (it wasn't a contractually necessary payment either, just a one off random huge lump of money)

However, a little aside. All this austerity is really bad for the economy. So even if you aren't a touchy feely softy feeling sorry for the poor old folk/disabled people/ickle children, and you're a hard nosed capitalist it's really stopping our chances of economic growth. even the IMF think so

ivykaty44 Mon 22-Apr-13 13:36:24

it wasn't hard in the same way that people are struggling now

Who are you kidding, most of the pensioners I know lived through the second world war and then the harsh times afterwards - all last year there were comparisons to the 1948 games and the 2012 - no way when you compare the two games are we suffering more now than back in 1948 otherwise we would not have had the show that we did last year for the olympics.

The 1970's were not pretty and the 1980s where harsh

Tax the pensioners and watch them leave in boats and on planes and they will not return and spend money here - they spend, not a lot at the moment as interest rates are low but tax them more and they will move abroad and not spend at all.

If you want MP's to think in the long term then vote in MP's that do think and act for the long term

ihategeorgeosborne Mon 22-Apr-13 13:38:14

It will be interesting to see if we go into a triple dip on Thursday. I can't see how we can't tbh. Everyone I know is having to watch what they spend and the cost of everything has sky rocketed. I really think we need a new chancellor grin

HeadFairy Mon 22-Apr-13 13:38:23

If you want MP's to think in the long term then vote in MP's that do think and act for the long term

That's the problem though, I don't think anyone ever does. They just think about getting through the next general election, so at best their policies extend to 5 years.

ihategeorgeosborne Mon 22-Apr-13 13:40:38

The problem is ivykaty, most MPs agree with you when they're in opposition, but the minute they get a sniff of power, doing the right thing seems to go out the window for them and winning the next election seems to take precedence over anything else.

HeadFairy Mon 22-Apr-13 13:46:30

Well you can be vocal in opposition can't you because you've got nothing to lose. I'm fact that's what you're meant to do. Once in govt though they've got to do everything they can to remain in govt, and that's often very short termist.

flatpackhamster Mon 22-Apr-13 13:46:31

HeadFairy

Actually I think the real problem is the opposite... a £50k income is in the top 10% by income in the UK because we have a ludicrously low level of pay in this country. Most of our salaries are being cut to give greater pay to senior executives.

No they aren't.

The rate of pay of senior executives has risen faster than the rate of pay of everyone else. Salaries haven't been cut, except in a few areas of the private sector. The cost of living has risen, particularly house prices.

Don't imagine for a minute that I'm defending the pay of the top earners. But let's see this for what it really is. It is not 'Evil Rich Bosses Cut Your Pay To Buy Themselves A Yacht'. That sort of boring left-whingery is what makes it so hard to make a rational case for altering the corporate reward scheme.

HeadFairy Mon 22-Apr-13 13:48:03

Flatpack it may not be an actual cut, but in real terms it is. Of course that's just semantics grin

ivykaty44 Mon 22-Apr-13 13:49:09

i don't think the MP's ever agree with long term policies unless it is cuts and this government seem to want cuts for the next 4 terms.

Go north and look at scandanavian countries and they seem to have a much better way of governing long term and consequently there countries fair better -so it can be done and it can be done well

handcream Mon 22-Apr-13 13:49:23

No, I am not suggesting that you have to sell your house because of the equity in it.

However, where will it stop, you have savings having been careful, as a couple you have both worked (and brought employment to childminders etc) and to the ecomony due to the taxes you pay and what you spend.

I am thinking of my DM. Has worked for 40 years as a teacher. Has the state pension and a private pension but has a small house worth about £350k in London She has little in the way of savings. Will someone come along and say because of the equity she will HAVE to move.

Its her only house btw!

We seem to be constantly going after people we consider rich. Who are we to judge, what about the couples who carefully chose their partner and who are still together 40 years later. Perhaps they both worked and are now comfortable. Are they more or less deserving than a single woman who has never worked and has chosen to have 3 children with fathers that are no where to be seen.

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