The top 10% of taxpayers contribute 60% of income tax...

[MsPinkMarshmallow]

I'm fed up of hearing that "high earners" will be targeted by the next budget.

The top 10% of taxpayers pay 60% of income tax.

Don't piss them off. They'll just leave the UK or work less so they're taxed less.

Some more stats: in 2024-25, the top 1% of income tax payers earned 13.3 per cent of total income and paid 28.2 per cent of income tax

35% of adults in the UK pay no tax at all

More from the Taxpayers Alliance here:

https://www.taxpayersalliance.com/briefing_share_of_income_tax_paid_by_percentile

<stands back and awaits kicking>

It depends what you're counting as income and how long the people have been high earners. I'll be honest about my finances as an example.

I earn a basic salary of 160k and a 30% bonus (discretionary and varies year to year but that's the maximum). So this month if I look at my payslip my taxable income (I put 8% into pension) was £13,333 and I was taxed around £5,000. So far so ouch! I end up with £7,200 to spend.

So that is a high tax burden. But I've built up some savings (all from earnings, no inheritance or similar windfalls) in ISA wrappers and an OK pension (genuinely just OK - my pot is small really compared to lots of people at around 250k). The uplift in my pension plus ISA totalled just over £20k this month - total tax on this uplift is £0. I would guess my savings are actually under average for my salary by the way.

So I have earned (if you want to look at it this way) £33k in October. My total tax was £5k. That certainly doesn't make me want to leave the country.

People are often bitter and want everyone else to have less than them, rather than pulling themselves up. People should pay to go to work so that they can sit about on benefits, pretty much.

Thanks for exemplyfying my initial point.

Jealousy is never a good look.

Stating reality isn't jealousy.

@MsPinkMarshmallow

‘The marginal tax rate over £100k is 60%, how is it fair that the government takes 60% of earnings over the threshold?

Why would anyone work for 40 pence out of every pound they earned?’

The thing between £100k and £125k is egregiously wrong. They need to straighten that out.

But, say someone earned £100 million or £1billion, why shouldn’t they give 60% of that back to society?

It also comes down to how people earn money, although, with rare exceptions, that’s not considered. If oil is up 70% in a year and an oil executive gets paid £5mio incentive for the rise in the share price, maybe they should be taxed more. And finance also pays egregiously highly as it is quasi state guaranteed but the rewards pretend the trader/investor is taking personal risk. I see that very different from a brilliant inventor or brain surgeon.

Tax is complex and multifaceted and there is very little correlation between tax rates and economic growth, except at the extremes.

OK, but do you really believe those principles or are they a post-hoc defence of a status quo you like?

A UK minimum wage job puts you in the global top 15% of income, even after accounting for the difference in living costs.

UK minimum wage earners can pay significantly more and still have a standard of living which is far beyond anything poorer people have.

If equity is the argument and that means from each according to their ability to each according to their need, then the case for taxing UK minimum wage earners significantly more (say, 30% average rate) to distribute to the globally poor is overwhelming. The global living standards gap is far greater than the UK one, after all.

If your counter-argument is just ‘that’s not how it works’ then I don’t see how you are doing anything more than retrofitting an argument to a conclusion. If it’s ‘I recognise some obligation, but not at that level, there are limits’ then isn’t that just OP’s argument?

*very differently

The biggest lesson of British fiscal policy in the last few decades is that if you give an inch, people will take a mile. People will just keep moaning for more and more and will never be grateful.

Maybe be thankful for how little tax the median earner pays. Maybe be thankful for the hardworking net contributers who pay for the lifestyles of other people.

Again, thanks for exemplifying.

"But, say someone earned £100 million or £1billion, why shouldn’t they give 60% of that back to society?"

Often, they already do by creating innovation, jobs and growth that everyone enjoys.

Get yourself a job sister

There needs to be more perks for the top contributors. Maybe the 10% who make the highest tax spend should get to have the inside lane of the motorway to themselves and be allowed to drive at 90. We need to find ways to get people aspire to pay more tax.

This is the best suggestion. Or a little badge that means you have to be given a seat on the train. Russian women used to get medals for having lots of children didn't they? Like that.

Ah, assuming now too. Great.

It's pretty unsurprising that high earners pay more tax than low earners.

35% of adults in the UK pay no tax at all This is false, as they pay VAT, but also the majority will be pensioners on low pensions.

And go where? I'm a top 10% tax payer but can't just up and leave!

We could hold a parade for them perhaps?

Glad we left last year then! Crazy if that actually happens!

OP, you probably won’t get the responses you’re hoping for on MN, but I do understand where you’re coming from… to some extent. Yes, billionaires and huge companies should absolutely be paying the taxes they owe, and many exploit loopholes to avoid doing so. However, it feels to me that Labour’s approach ends up penalising ordinary people for working hard:

• Work hard and earn a good living - more goes to the government.
• Save for your dream house that’s just outside your budget - taxed more.
• Happen to live in a house that has increased massively in worth since you bought it but actually are just a regular hard working person - ah that’s a shame, more tax for you.
• Scrimp and save to afford a second property to one day pass on to your child - taxed more.
• Work your whole life, pay taxes, and die - 40% of your estate goes to the government.
• Sacrifice everything to send your child to private school - ah they are rich they can afford to pay more tax.

It genuinely feels like this government won’t be satisfied until there are no millionaires or billionaires left, and the middle classes and small businesses are squeezed just as tightly.

Actually if you open the article and follow the source, more penisoners pay income tax than working age. The proportion of 16-64yos who pay income tax is just 63%

The reality is that, at the very top we have the opposite of a progress tax system, as much of their earnings comes as dividends and CGT.

Simple AI summary:

‘The effective tax rate for the top 0.1% of wealth in the UK is complex and varies significantly, but
studies show average effective rates of around 35% for the top 1% of income earners, with the rate for the wealthiest 0.1% being even lower when accounting for capital gains. While their average income tax rate may be around 35%, the effective rate can be much lower for those with substantial wealth, as much of their income comes from capital gains and dividends, which are taxed at lower rates than wages.‘

And that’s before accounting for tax avoidance and plain old fashioned evasion.

Depends on your type of work but there are many places around the world that offers rewarding packages for you to relocate.

How would you distinguish between earned and unearned wealth? Taxing earned wealth is double taxation. I think the most unfair tax is council tax and the suggestions to double the amount on high band properties seem particularly unfair. What about those in expensive properties due to having to live in an expensive area due to employment but with larger mortgages and low disposable income? Income tax is much fairer than a wealth tax.

@Newbutoldfather

But, say someone earned £100 million or £1billion, why shouldn’t they give 60% of that back to society?

I think one problem at that level is ‘which society?’. There are some billionaires whose fortune is very clearly tied to one country, where there’s a very clear moral claim.

But many billionaires have very global interests, and I the case that they ‘owe’ the UK in the same way is weak.

The founder of Revolut recently moved from the UK to UAE, saving himself hundreds of millions of pounds in UK CGT.

He was born, raised and educated in Russia. He founded Revolut here, but about 80% of Revolut’s customer base is non-UK, and its banking licence is Lithuanian.

We should have personal tax conditions that encourage global billionaires to come here and stay here. A small % of a lot is more than a large % of nothing.