..to want to say to those who are whinging about the 50% tax rate

[vic77en]

..that they should fuck the fuck off?

At a time when lots of people are really struggling with high inflation, 20% VAT, high unemployment, lack of living wage etc etc.

If you're earning above the 50% threshold you are well off and can afford it.

I used to earn enough to pay 40% tax (this was before the 50% rate came in and I was nowhere near the 50% threshold) and did not begrudge paying this. If NI and VAT were factored in, over 50% of my income went in taxes. I still had high disposable income.

Rather than giving their views airtime, there should be a massive PR exercise on the benefits to all of us of living in a civil society where there is an economic safety net, NHS, free education (for under 18's at least still...)

AIBU or not?

Do I? Pmsl

That's coming over wrong then!

but thank you; that's how I would like to be seen.

Maybe people would be more keen to pay tax if this country wasn't such a shithole to live in? So much tax just goes into the pockets of government officials and other public sector types, and we never see the benefit of it. Not to mention the underclass with their feckless breeding habits.

Here they come; best go collect the boys then. From their public sector schools / using public sector special needs transport.

Ho hum.

(PS where I live is really quite a low income area but in no way a shithole. It is pretty and rural with good schools and you can rent a nice house under £600 pcm. HTH)

Whilst I do think the 50% tax rate does have negative consequences, I don't think we can afford to scrap it. We have a budget deficit of around £150 billion and so the Government needs to maximise its revenues (as well as reduce its spending) if this problem is to be resolved.
Btw the idea that VAT can be reduced is even more ridiculous than scrapping the 50% rate.

this may turn out to be an Osborne dirty trick rather than his smutty jokes.
Giddeon is a great name for Ossy

I posted a long reply to aerol and MN cashed , I have bored it into submission.

To sum up (need to put kettle on, DH due home now) a VAT cut could be an answer as p[art of a package: it's not about cutting taxes but increasing revenue and if VAT stimulated retail and spending it would make sense. VAT is also shown to penalise the poorest which would be a positive spin as well.

But the right answer has to fit three criteria- be productive in terms of actual take (over costs) ; actively stimulate growth rather than suppress it ; promote spcial cpohesion via careful political measures so that we neither send compaies abroad nor cause costs to amount via inspiring amss protest or even riots.

I am not sure we have a good enough picture from our biased media / stats to actually diine what that ideal combination is; but it's not been found yet.

peachy- The VAT rise generates an extra £13 billion for the treasury, I don't think a cut would generate a stimulus that generate this amount of income and so the treasury would lose out which given the already dire fiscal position we can ill-afford.

Another worry that is always ignored is inflation, it has been very high for a very long time and the BoE does nothing and there are even more mumblings of further quantative easing both here and in the US.

Aerol. Economically we could easily scrap the 50% tax band. Depending on who you talk to it either brings in no money or very little. Noone thinks it brings in a lot. That combined with the brain drain (plenty of examples just on this thread of people leaving) and the knock-on effect, you can easily argue it doesn't make financial sense at all to keep it.

Politically though they can't scrap it.

It was always supposed to be a temporary measure though when Labour bought in it.

Annoying that the Tories will end this Labour temp measure and we'll get all the normal wails of 'Tory fat cats' etc etc. Yawn.

I haven't read the whole thread yet but I completely agree with a flat low rate and a far simpler system. Someone mentioned Hong Kong. Wouldn't that mean a lot of accountants would be redundant. One of the big oil multinationals spends more on tax avoidance than on finding oil.

Niceguy, why is a flat tax not going to happen? Wouldn't it make the whole economy more efficient?
My bil relocated his hedge fund to Ireland for tax reasons. It just made sense to him with 3 sets of school fees to find.

@pommed. Yes, it was a very politically cunning trap set by Labour. A win-win for them. If they won the election, they could scrap it and refer to the fact they said all along it was temporary. If they lost and the Tories tried to scrap it they'd look unreasonable and protecting their rich mates. Unfortunately the price we all pay is the loss of the tax revenues and money the rich folk spend in our economy.

@Inextremiss. It will never happen because it's political suicide. Which rate do you pick? 20%, 40%, 50%, or somewhere inbetween?

So let's say you pick 20%, there will be howls from people saying "Oh look the nasty Tories letting the rich off". If you pick any other value, people FEEL like they are being asked to pay more. Perception & spin is often key in politics. Reality is often inconsequential.

Plus once you say have a simple tax rate like say...35%. People can quickly work out...."Hang on a minute......why does the government need so much of my money?" Right now the tax code is confusing and serves a purpose in so far as its difficult to work out what you truly pay. Yes you get a P60 annually but how many people have sat down and worked out what proportion of their income they effectively paid in tax, let alone tried to work out if it's correct or not? I know I haven't!

I agree with niceguy. Osborne is in a very difficult position here. A very significant proportion (if not the majority) of the 300,000 people who pay the 50% rate are in the financial services sector (which is the single biggest industry contributor of taxes to the Exchequer). When the FS industry catches a cold the rest of the UK generally catches flu. We have an ever dwindling manufacturing industry and so any recovery will need to be FS led.

In addition, while Europe and US have been in recession, actually 6 key countries have generally fared well over the last 3 years and didn't really have a recession. These are the the BRIC countries (Brazil, Russia, India and China) plus South Africa and Australia. These countries present a challenge to the existing order of things but every single FS organisation believes that its in these 6 countries where the action (ie profits) is going to be, so they are all organising themselves to be able to tap the opportunities in these countries and this includes beefing up operations either in these countries or nearby. The 50% rate is only ever the key driver for smaller FS outfits such as hedge funds and private equity but it is still a significant contributing factor in the decision making for the bigger players.

Therein lies Osborne's problem. He needs London to remain the no 1 FS centre else the UK will not recover economically yet he's got all these other countries competing with the UK for investment. He needs to cut the 50% rate to show that the UK is open for business and remains a serious player as an FS centre but the average person doesn't understand this at all (and Tories haven't helped themselves with the "we are all in this together" strapline) and so it would be political suicide. Overall a pretty nasty (but bloomin clever!) leaving present from an outgoing Govt.

If the 50% tax rate brings in more money it should, IMO stay. However if it does not bring in extra money, or a very small amount of extra money it is pointless and should not stay. Seems rather simple to me.

I am a 40% rate payer as are most of my social circle, I have never heard anyone moan about paying their tax. It could be that people moan privately of course. If I thought it would help I would pay more tax.

When I used to mix in circles full of people earning the figures that would now attract the 50% rate people were always moaning about their tax and plotting to reduce their tax bill. Perhaps that reflects the fact that they are giving up a larger amount of money or perhaps that people who earn/make that amount of money are more attached to that money which is why they earn/make it in the first place.

Fabby I work similar hours as your son for about 40K a year. I have time for a social life and to raise a family. If he works until 8pm does he not go out then? I also have strict rules to follow regarding my personal appearance and clothing, ( although I do not have to wear shoes that cost £300 which sounds rather daft but he is young) I do not see that as a reason to be paid huge amounts of money.

Twinkly if you're earning £40k then you are only paying 40% tax on a few hundred quid

150K salary does not make you rich in London. Bear in mind the additional taxes: car, council etc....it's too much. Nobody should have to give away over half of what they earn.

I know how much I am paying 40% on, my point was that most people I know do not moan about paying their tax, even those well into the 40% bracket.

I have lived in London on the type of income being discussed and I felt quite well of, although I did not have to pay for children over an extended period.

my company accountant visited today and told me i had earnt £170K last year. it was a bit less than i was expecting.... we then spent the next hour discussing tax minimisation. by shovelling money around he legally saved me tax. i think i will give myself a No a whole plateful

(but i will still minimise my tax )

OK, I know next to nothing about taxation etc - what I do know is that I resent the idea that a lot of people with incomes over £150K sem to have (as evidenced on the 8 pages of the thread that I have read so far) that because I only earn £13K p.a. before tax for a 37.5hr week that I somehow work LESS hard than they do. I stand on my feet for 99% of my working hours, I can't afford to 'buy in' help - so when I get home, I still have all my cleaning, housework, ironing to do - all things that these people can afford to 'buy out'. Yet I work LESS hard than THEY do??!! NO.

Do the wealthy work harder than the lowest paid workers? Well, if that IS the case, then why do manual workers (usually those on the lowest pay) have much lower life expectancy, even now in the 21st Century? Because I think that it's the LOWEST paid that work the hardest, as not only do they have to work bloody hard AT work, they then have to go home and do all the jobs that their bosses can pay someone ELSE to do.

Maybe the 50% tax rate is unfair - but so is the 20% tax rate for people on minimum wage!