To think everyone should pay the same income tax?

[bigch]

It seems unfair that the people who payed thousands for university, work full time to earn a higher wage or have their dream job are contributing more of a percentage of their income to the system than those who just wern't bothered or decided to have a lower key job.

20% of 100k is a lot more than 20% of £18k and they don't even use the same services such as public school, benefits, ect.

Not rich myself, decided to become a flight attendant because it was what I wanted, but my more hardworking richer friend shouldn't be paying more for my lazy ass to live, I do it fine on my own.

[NickNacks]

Yabvu!!!

And your reasons don't make sense.

[ATruthUniversallyAcknowledged]

[bigch]

Friend's a neurosurgeon by the way. Takes years of training, lucky she doesn't want children, it would be impossible to balance.

[chickydoo]

You get taxed a lot more than 20% on 100k

[mumblechum1]

As chickydoo says, you'd pay a lot more than 20%. My dh gets zero tax allowance and pays 50% of part of his income and 40% on most of the rest.

tbh he doesn't resent it, although we have private healthcare etc. He grew up in extreme poverty and accepts that other people need money more than we do. Food, oil, logs, elec etc cost the same for us as for less well off people.

does your friend say that she resents paying a higher tax rate?

[JeezyOrangePips]

There's not as much of a difference as you would think. At basic rate, people pay NI, (varies between 9ish and 12ish %, most people pay 12ish). At higher rate, they don't.

So you are really comparing 32% and 40%.

Don't see the problem myself!

(btw, higher earners pay less tax proportionally when things such as VAT and duty are taken into account.)

[xkcdfangirl]

chickydo I think that's the OP's point.

If we followed your plan OP, the flat tax wouldn't be 20% but 25% or 30% as the lost tax from the rich would be taken from the poor. For every one rich person who would have a bit more cash for another holiday, there would be 10 or more people on low incomes who therefore had to pay more tax and were pushed over the border into penury and destitution. I would hate to live in a society that cared so little for it's weakst members.

[JeezyOrangePips]

Actually that wasn't strictly accurate. People on higher rate pay 1% NI now, so it's 32% and 41%.

[Brycie]

Oh my gosh you are assuming that everyone on a low income is lazy and everyone on a higher income is harder working. So you're completely wrong just because of that assumption! In universal terms of hard work I would go with care workers above just about every professional I know, including doctors and lawyers! Ok maybe that's a generalisation but basically any argument based on the idea that low income workers are lazy is not really worth anything at all. Sorry

[JeezyOrangePips]

I wouldn't read too much into the 'lazy' comment. I know very hard-working flight attendants.

I suspect the op was really referring to ambition rather than anything else.

I could be wrong though.

[Brycie]

Progressive tax is a great civilising force, providing it's no disincentive (so it brings in less as it rises) and providing it's matched by representation. What gets taxpayers goat (I bet) is not the progressive nature of tax, or that it's spent on helping less fortunate (as well as service supply) but that so much is wasted. But the waste of one person might be nuclear weapons, the waste of another might be benefit fraud, so it should even out.

[Brycie]

Oh I see. Yes I understand that. Still I think the only argument is not to make progressive tax such a high marginal rate it becomes a disincentive.

[JeezyOrangePips]

I wish I knew what you were talking about Brycie. If I did i'd know if I agree with you or not.

What is progressive tax?

[Brycie]

It's how the rate of tax increases as the taxable amount increase. So earn 20 - pay ten per cent tax. Earn 40 - pay 30 per cent tax (on a proportion of income at least). Earn 150 - pay 45 per cent tax (on proportion of income at least)

I don't think those figures are the right UK figures at the moment but that's the idea. As oppposed to someone on 20 paying 20 per cent tax and someone on 150 paying 20 per cent tax.

[Brycie]

The other kinds would be (I think I've got the names right here) a flat rate tax (ie everyone pays the same percentage) and a flat tax (where everyone pays the same amount). Flat tax is manifestly unfair that's why the poll tax triggered riots.

[ChasedByBees]

Your sense of fairness, logic and reasoning are off but I'll let others deal with that.

Your idea doesn't make financial sense. Taxes pay for the upkeep of our roads, the police, schools, healthcare, science and research, a huge range of things that everyone uses. If we consider that currently higher tax rate payers would drop to a flat rate then the shortfall would need to be covered by everyone else. I imagine the amount would probably exceed many lower incomes. I might go and try and work out how much it would be actually...

[honeytea]

Op yabvu, it's not just the low earners that your taxation idea will effect it is society as a whole, the more people living in poverty the higher the rates of crime there will be.

missmybellybutton don't be so mean, op wasn't asking you to correct her spelling, it would be like me saying to you it's a shame you couldn't go into any of the caring professions because your so mean!

[impty]

I think most people who pay 45% tax realise that they are in a fortunate position.

[bugster]

For me this is also an interesting point. My instinct is also that everyone should pay the same percentage, because as the OP says, 20% of £100K is a lot more than 20% of £20K. So the well off would always be contributing more than the less well off. From the point of view of fairness, that seems fair to me.

However, I suspect that just wouldn't raise enough funds for the public purse, so in practice the government try to squeeze more out where they can.

Not having lived in the UK for 10 years, I didn't know that higher rate tax payers don't pay NI. Is that really true, if so why? Where I live all taxpayers pay the equivalent of NI.

Interested in people's comments as I'm no economist!

[lightrain]

Jeezy, what makes you think that higher rate tax payers don't pay NI? They do, at more than 1%.

[JeezyOrangePips]

Thanks Brycie, I thought that might be it :)

[JeezyOrangePips]

Sorry, you are right, it's 2% now, on anything above 40k per year.

my apologies. That must be reasonably recent.

[MissNJE]

100% agree with you. I don't understand why people that did well should be punished and work for other people. Somebody on a high income is more likely to use private schools, private health insurance etc. anyway.


Its the people who avoid paying tax and the big tax avoiding companies that need to be tackled down.

[bbface]

Jeezy... Complete nonsense about NI contributions. Where on earth did you get your information from?? Higher rate tax payers do not pay NI. One of the daftest things I have read on mumsnet. NI contributions are for our state pensions so it would make zero sense for higher rate payers to be excluded from NI contributions.

This is copied from Hm Revene and Customs. So the definitive. IGNORE JEEZY!!


If you're employed
If you're employed you pay Class 1 National Insurance contributions. The rates are:
if you earn more than £146 a week and up to £817 a week, you pay 12 per cent of the amount you earn between £146 and £817
if you earn more than £817 a week, you also pay 2 per cent of all your earnings over £817