The rich ger richer

As money doesn't buy happiness why should those with less want more? There will always be someone with more than you and getting more is not some secret key to happiness as we all know.

Piss off Xenia. It's not about wanting as much as the next guy, it's about being paid a fair wage for a fair days work, and some - many - people don't have enough money to fulfill their basic needs in life.

Money doesn't buy happiness after a certain point, but until you reach that point, you're going to be unhappy if you don't have enough of it.

And to turn your nonsense around - if money can't buy happiness, then why not be satisfied with the first million pounds you own, rather than buying up houses and increasing property prices for everyone else? Money can't buy happiness after all - so why not just give rid of everything you own except for what you need to live a reasonably comfortable lifestyle?

Saisi - I suspect Bermuda may not have read the whole thread.

Bermuda - Siasi was just illustrating that even people who invest in property (and own several) may support the land tax idea (which is interesting).

Xenia - my understanding from ttosca's link; is that it's the value of the land the tax is based on. Land values vary by area, of course. But if you invest in your property, the tax remains the same.

But, I also agree with siasi - it's unlikely to happen anytime soon.

I don't think numbers of houses really matter. I know someone with 6 and they're worth less than mine I was surprised to hear. The number doesn't necessarily indicate particular wealth.

As money doesn't buy happiness why should those with less want more? There will always be someone with more than you and getting more is not some secret key to happiness as we all know.

It isnt a problem for me.

But why did you think i needed to know that you've paid off your mortgage ?

You sound like one of those ostentatious brummies from harry enfields show,i imagine you're a very materialistic person and make sure everybody knows about it.
Your husband has my pity.

bermuda ...

one house was bought by my DH for his retired parents to live in (he carried on renting since he wasn't certain which country he'd be working in); it allowed him to buy some property whilst also giving his mum and dad a nice house to live in.

the other was bought by me before we got married. i've saved up and paid off the mortgage.

why exactly is that a problem for you?

You own 2 houses and are looking to buy a third ?

That's very interesting,be sure to find one with big doors so you can get your head through won't you.

MY DH and I own two houses and are looking to buy a third house as a family home. We'd happily pay a land value tax in return for lower income tax.

A land value tax would be a hugely sensible answer to a number of UK economic and social problems. More affordable housing, more efficient use of land, more reward for hard work and less reward for the privilige society has conferred on land ownership.

Unfortunately, it runs against the age-old Anglo-Saxon property fetish, pathetic and ludicrous as it is. Politicians of all flavours are in thrall to the property market and it's vested interests. The opposition from developers, land owners, landlords and media would be huge. It'll never happen!

I think the "rich getting richer" thing has a lot to do with the stock market ove the last 12 months. As Quantitive Easing (well done Gordo) hits - the money has to go somewhere, the stock markets are not making "real money" - the figures are just rising with all the printed money.

From my pov, there's very little point whinging about the Rothschilds of the world - they always were, and always will be, completely untouchable.

52% UK (50% tax and 2% NI I think when recent rises come into it ) and 56% Sweden. So the attraction of the UK is disappearing and we will do worse. we now have one of the highest tax rates in teh UK and those on PAYE which is most people who are high paid directors, many bankers etc can't avoid or evade as it's deducted at source so they ask to be based in Zug or somewhere hotter or wherever instead.

ttosca - I like your land tax link - thanks.

Firstly, it acknowledges that many people on the political right dislike what inherited wealth does to meritocracy and to productivity. (understanding other's ideology - not normally a Guardian strength.)

But also it draws a distinction between taxing wealth and taxing wealth creation. Very thought provoking.....

As I've said on here before - if you really want to tackle inequality, you must start by defining what you actually mean by it.

jack-

High progressive taxes are good for equality if they are actually collected and spent providing services to the public.

Nominal taxes only show part of the picture. Corporations and rich individuals do their best to avoid them, so there should be both a crackdown on tax evasion and taxes should be collected in a way which is harder to avoid. For example, one idea is the Land Tax:

www.guardian.co.uk/business/2011/may/02/land-value-tax-oecd-comment

In any case, europe has run progressive high-tax regimes for decades and has relatively less poverty and far less wealth inequality than low-tax (or low tax-collecting) countries like the US and UK.

Can I just point out that not all top rate tax layers are trying to avoid their tax. Many, including my husband, are glad to pay back into a system that has served them well. To do anything other than that would be greed IMO.

Now I'm confused - are you saying high tax rates are good for equality (as in Sweden) or irrelevant?? You can't have it both ways.

The UK might have a reasonably low corporation tax rate, but total corporation tax collected is high compared to other countries, and contributes the highest share of overall tax of any country. Tis - a very successful tax for the UK.

Nominal tax rate has very little to do with what the rich actually pay. In that respect, the UK somewhat of a tax haven, especially for business which actually has a nominal corporate tax rate which is amongst the lowest in europe, and where UK businesses seem to be able to evade tax through off-shore tax havens, and shady deals with the Revenue & Customs (viz. Vodafone).

The idea that high tax rates harm the poorest is complete nonsense. Corporate taxes and taxes on the wealthiest have been decreasing for decades. We haven't seen the poor prosper under these conditions. On the contrary, wealth inequality is greater than ever, wages have stagnated, and there are as many poor (if not more) than there have been in decades.

And the Top UK tax rate is the fourth highest in Europe. Highest is Sweden with 56% (down from 60% a few years ago).

The UK's top tax rate is higher than most other European countries (including France and Germany).

ttosca - in recent years Sweden has been reducing it's top rate of tax in order to halt it's 'brain - drain' (to London mainly). So has Denmark....

There have been well educated, intelligent Scandinavians working in the City for years.

I bet they breathed a sigh of relief when we introduced our 50% tax rate.

High income tax just means you move away or convert income to caapital where you can and spend more money on tax advisers and the Government receives less of a tax take. It also stops people moving businesses here. It damages the poor.

That would explain Sweden, and, in fact, most of europe, where taxes are higher than the UK and where there is far less poverty and far less wealth inequality.

I guess we will found out if 50% tax is the tipping point. Apparently we should have some idea by Jan 2012.

Also, it looks like the High Pay Commission's Report (that ttosca was quoting) is an interim one. The recommendations come out later. Maybe I'm being cynical - but I'm not holding my breath!

High income tax just means you move away or convert income to caapital where you can and spend more money on tax advisers and the Government receives less of a tax take. It also stops people moving businesses here. It damages the poor.

If you look at Labour's record over their 3 terms - things aren't quite as bad in terms of inequality as it first looks. Yes, the richest top 10% pulled away (the top 1% especially). But if you take the other 90% then incomes did close up - as poverty decreased.

As other have suggested the very highest incomes are difficult for national governments to control in a global economy. Actually ttosca's c & p illustrates this by outlining the problems, without offering sufficiently actionable solutions.

It will be interesting to see the impact of the 50% tax (and other tax increases) on the top 1% of income tax payers.

The myths the realities...

'Big money is needed to get the best chief executives'

That assumes most are brought in, when 59 per cent of CEOs in the FTSE 100 were already at the company for five or more years.

'Being a CEO is risky, so they need to be compensated'

Hardly. Only six CEOs left FTSE 100 companies in 2009, a turnover rate of 6 per cent, which is less than half the national average.

'Big pay packets are linked to business success'

What about the bumper pay for bankers that caused the crisis? Over the past 10 years, CEO pay has quadrupled while share prices have fallen.

'Big bonuses mean better results'

Not necessarily. Research suggests performance-related pay works 50 per cent of the time ? and bonus culture didn't stop bankers leading us all to crisis.

'Without big pay packets, executives will be lured abroad'

Only one FTSE 100 company has had its chief executive officer poached by a rival in the past five years ? and that was by a rival British firm.

'Our high pay is in line with other leading countries'

It is significantly higher than the rest of Europe ? it is less than in the US, but its CEO pay is 170 per cent higher than the rest of the world.

'Highly paid people at the top boost a company's success'

Having a pay gulf between staff at the top and bottom of a company can damage personal and corporate relations. Just look at how popular bankers are now.

'Top earnings have always risen faster than average wages'

Until 30 years ago, the gap had been decreasing. From 1949 to 1979, the proportion earned by the top 0.1 per cent decreased from 3.5 per cent to 1.3 per cent.

'Top earnings rise at the same percentage rate as average pay'

No. The earnings taken by the top 0.1 per cent increased by 64.2 per cent in the past decade, while average pay went up by just 7.2 per cent.

'Attempts to regulate CEO pay would be bad for the economy'

When you pay disproportionately high rewards in one sector ? such as finance ? it is harder to attract good graduates into other vital areas of work.

www.independent.co.uk/news/business/news/exclusive-salaries-for-top-executives-are-rocketing-out-of-control-2284397.html

I'm sorry, but the idea that the developed world should compete with emerging countries like China and India for wages and workers rights is laughable.

Such a situation would take us back to kids working in workhouses.

No, there is plenty of wealth to go around. The rich have never been richer, and in fact, are getting richer ever year. There are plenty of things we can do to ensure that people who work can afford a living. Clamping down on tax avoidance is something that can bring in tens of billions every year. Capping renumeration at the top will ensure that companies can afford to pay their workers a working wage. A 'living wage' should be put in place so that no person, if they work hard to make an honest living, struggles to pay their bills and heating.

A race to the bottom is not a solution but a quickest possible way to return to Victorian working conditions. People will not tolerate this. If you think there is unrest in Greece, just wait until the majority of the public in the UK can't afford to pay for the basic cost of living.