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>

Is being taxed at an effective 100% rate between £100-150k fair though, because it’s more than most earn?

Do you think the wealth you've accumulated is earned and that is why you dont think its fair to pay taxes on it?

Whats your answer to this then?

Not increase the minimum wage and have some workers living in the gutter maybe?

Would you like to try and survive on minimum wage? Do you never get a eage increase?

So many questions about your list of ideas (60% on all income over £100k?) but this stands out in its randomness…

“Total individual ISA limit should be set at the Personal Allowance level.” - why?

And you propose the personal allowance is £16k so this is only slightly below the existing level anyway.

This thread is so depressing, people earning 60 - 150k lets say, have worked hard and have done well for themselves, this salary bracket will include your hospital consultants and dentists not just your much maligned bankers and Advertising executives. Do you want your doctors and dentists to work less to reduce tax burden or leave the UK completely?

I want to live in an aspirational country where you are not punished for striving. The UK is currently self harming itself. Humans compete, they want to succeed, it’s a natural instinct. So people will want to do well and increase their salary, take that away from them, through punitive taxation, and it causes psychological harm.

Someone on £64,800 per year is in the top 10%. That is not enormously wealthy. It’s about £3800 per month, less once you take pension contributions and student loans off it. Where I live, you would pay approx £2k per month mortgage for a two bed terrace house (assuming 10% deposit), plus about the same in childcare. In other words, you couldn’t afford both of those things on a top ten salary, never mind other bills or food.

It is not always simple to assess what is “earned”. Let’s say a financial advisor works and earns a living working for someone else and pays PAYE, but then uses the knowledge they have to invest wisely by scrimping and saving and foregoing holidays to then retire early in their late 50s. They still used their skill and time to increase their wealth. Why do you have to work for someone else to do that? These old fashioned notions of what is work and what is not are massively outdated. If I sit with my kids and help them with their GCSEs etc, that is still my time and work and whether or not I do it or a tutor? Really? If I clean my own house that is not work, but if I pay a cleaner to do it, that is work?
Basically, all this tax nonsense just means people will “work” less at what is categorised as actual work where you have to pay tax, and will “work” more on stuff where the taxman cannot get to them, to save money that way. Everything is about opportunity cost. If it is cheaper for me to buy a bread machine and flour and power it by my own solar panels than to spend £4 in the supermarket, I will do it. We have been a high consumer society thus far. Labour and tax policies are going to push us all into DIY and non consumption. Which will lower tax take and the amount of jobs available. People who earn well and it is worth working long hours, will then pay others to do basic stuff for them. If it is no longer worth doing that, they work less and DIY. Less jobs, less money etc for the whole economy.
This Government has no choice but to also cut spending. If they just tax more, it is not going to work. It needs to be a combination of all of it. If they are going to hit people, they must hit everyone pretty much equally so that nobody can grumble. Taxing the rich and those who do not need the extra money - it never works as they have all the power to adjust their behaviour. They will always pay as much tax as they want to.

But if those over £100K face 60% tax on any income they earn above it, without the ability to put more into pensions with decent tax relief..... then why would they bother to work? I'd be reducing hours pronto and staying below £99,999 and enjoying more time at home with my family, thank you. The government then loses any tax take on my earnings that I would have made above £100K.

The tax relief these workers would get on pension contributions wouldn't be enough to incentivize them to save it into the pension. Why lock so much away for decades when you're still paying tax on it going in? Might as well just save into a savings account elsewhere - at least its available for use whenever. Which eventually leads to these people exiting the workplace far, far earlier than they would if they'd have had to wait for pension age (as even private pensions can't just be withdrawn until ~57). So then there's a skills shortage. For any pension contributions that are made at flat 20% tax relief.... it'd be taxed twice - once on the way in at 40% and then again when withdrawn. Again, zero incentive.

With the state pension as it is, most younger workers are making retirement plans that assume it'll be means tested and therefore private pensions become more important. The gov needs to incentivize people to pay into private pensions to save for retirement, otherwise they're stuck supporting a state pension scheme that is wholly unaffordable or scalable for the future (as it is now). Your claim that the max anyone should be able to pay into a personal pension is 50% of a £16k personal allowance is ridiculous as a result.

I agree with you on removing NI - it's stupid and should just be rolled into income tax so it applies to all. And I also agree that our bizzare, archaic council tax bands need changing to align with the actual value of a property in today's terms.

I think this government are fucking everything up beyond belief tbh.

As someone else said, people behave in ways they're incentivised to behave.

So the NI increase caused a hiring slow down, employment became harder

The workers rights bill will slow that down even more because it'll become harder to get rid of people who are crap at their jobs (and employers should be able to get rid of crap people)

The employment market is already really tough, it's going to get tougher as a result of the above

The proposed renters reform bill means the rental housing market is affected: not as many people want to be landlords because it's going to be harder to get a tenant to leave if you need your property back. Fine if nobody needs rental properties. Oh, wait!

The roads are shit, the NHS is broken, schools are a mess, public transport is unreliable, strikes are a fact of life...

Labour can make cuts, but won't. I have no answer, I'm just bracing for the recession to get deeper.

I have had a couple of payrises over the last year in the private sector, but that soon will not be enough and another payrise will have to come, less the company goes bust because it's services become unaffordable and we start having to let people go.

The thing is with Council Tax though we already pay three grand a year on a band E for what seems to me a fairly modest family home, and it has gone up above inflation every year for the last ten years probably. And as it's Kent County Council I don't want to pay more to the Farage mob to waste it further on their ineptitude.

So any recalculation which involves me paying more than the annual 5% increase can chuff off.

The housing market needs affecting though, it's crazy. Leasehold reform is much needed.

I genuinely do not understand this argument. It is often suggested that VAT is a regressive tax because the poorest in society pay more as a proportion of their income. But the poorest pay more for EVERYTHING as a proportion of their income - VAT, bus fares, flatscreen TV’s (old MN cliche there!), Jaffa cakes, postage stamps - because their income is smaller.

If they didn’t pay more as a proportion of their means, the maths wouldn’t math. The only way to change this would be to increase income, but even then, “the poorest” would still pay proportionally more.

I’m good with my friends, thanks :) and don’t worry, I’m far too busy supervising my kids when I’m in the playground to engage in political discussions with the likes of you. Not sure what you mean by ‘society facing high earners’, are these higher rate taxpayers that are doing a job you deem useful to society and therefore they are morally superior to regular high earners🤔

Its really not.that.high. You're talking about the top 1% who are mega millionaires. The top 10% are not super wealthy most of them. People seem to think unless your household income is less than £50k you must be super rich. Our household income is £110k and we arent wealthy at all. We are waiting for next payday and living mindfully- certainly not struggling lots but with cost of childcare and bills/mortgages going up we arent minted. We need to move away from low incomes and benefits being the norm and 'everyone else' being seen as priveleged. Being completely self sufficient should be the norm.

And more often they buy themselves another yacht or blast themselves into space

I wish “they” would crack down on dodgy businesses which are everywhere who run for 2 years, never file accounts (or pay tax I guess) and close and reopen with a new name. Boils my blood

Could you give us a worked example of this please? Eg a family with one NMW worker and a SAHM with no savings (so include their UC) versus a family with 2 earners just in the top 10%?

Obviously benefits are not earned income, they are negative tax.

Both of which create lots of jobs for other people.

Top
10% is above I think around 50 or 60k pa

Everyone’s going to think chuff off though. I’ve seen posts from G and H where their house isn’t worth that much but their council tax is so high, and there’s talk of double.

People - and by this I mean ordinary working people, employees- need to be paid more by the organisations that employ them.

wages need to rise for those lower down, not just the ones at the top.

make work pay and incentivise the businesses to put money in employee pockets not their own off shore accounts etc. all working people should pay income tax, but the salaries need to be paid by businesses not the welfare state top ups.

we should not be paying housing benefits to people in work, they should be able to keep a roof over their heads themselves. Salaries need to rise so that tax receipts rise overall, make it a blanket uniform tax would make it even better

there was an article last week about DPD parcel delivery company

Pre tax profit was over £200m. The boss took home over £1.5m, including salary and bonuses. His pay rise was £90k alone.

DPD reduced the rates of pay so tha drivers lost £25 a day, their Christmas bonus too. All in all about £8k pay cut.

the firm fired and persecuted those who spoke out about it.

It’s this greed that’s rotting our society

I agree, that's wrong @MzHz and DPD should be ashamed.

I support an increase in the NMW too.

People should be paid enough to live on. It should be affordable to buy a home.

Band E in Kent is £2k not £3k - are you sure on your numbers?

I only checked as I pay £3k a year for band E in a notoriously very high council tax area and was surprised Kent would be so high.

I think you’re right.