Are taxes too high?!?

[RedneckStumpy]

As a Brit living in the US I often get asked about life in the UK. Last night I Went through the usual discussion, then was asked what the taxes were like. So I outlined income tax and sales tax and was challenged with a question that stumped me.

Why would you bother trying to better yourself?

It’s all ‘pull yourself up by your bootstraps’ - we’ll what if you don’t HAVE bootstraps?

The origin of that expression was in pointing out that it's impossible to pull yourself up by your own bootstraps.

Americans only hide behind that bullshit so they don't have to face their complicity in and responsibility for the huge inequality and suffering in their country.

Absolutely ‘Anouk’

“An £80k salary is knocked down by tax and the costs incurred with having an £80k job, to result in barely a difference in disposable income from a £15k salary which is topped up through benefits and added to with free this and free that.”

You dolt. I’ve earned £15k and I’ve earned £80k. They’re not in the slightest bit the same.

And I now earn £200k, so the tax system didn’t disincentivise me. In fact, there should be a new higher rate band above the 45%, because it’s much easier to get big pay rises once you’re already earning quite a lot.

Far too low. People whinge and whine about healthcare crisis, education issues, shit policing, and cuts to defence, cuts to benefits etc etc.

However they also complain about paying tax, go figure.

I think we need 50% tax for anyone who earns over 150k. But only on the money earned over 150k obviously.

I think we need to close all 'legal tax loopholes for businesses and individual'.

I’m a high earned and I can confidently say that 1) despite the higher taxes on my earnings it is still very much worth it, and 2) I would happily pay even higher taxes to find healthcare, education, infrastructure etc.

Tax is too low in the US and we live in a very high tax part of it. We are on a tax equalizer scheme so pay UK level tax, so minimal personal impact. The US has no money it seems for public education, healthcare, maternity rights, ensuring clean public drinking water in some areas. Americans are usually less shocked at European tax levels when you explain what you expect the state to survive.
You better yourself for a wide range of reasons, money (tax isn't 100%), a better job, a more interesting job, more control in the organization where you work, the satisfaction of increasing skill levels etc.
That said there are a few pinch points in the system in the UK where earning more doesn't mean you take home more and that is frustrating for people.

Taxes on low-income workers are too high. Nobody working full time in a minimum wage job should pay income tax. They should be able to keep every penny they earn. The Tories have done an excellent job on raising tax allowances for the lowest paid, but they should go further.

Taxes on average and above average income workers are about right.

VAT is about right, but should probably be increased for non-essential luxury goods, eg designer handbags & Swiss watches.

Taxes on the rich, (ie the top 5% of earners), on multinational corporations, on property and on assets are far too low. We should have introduced a financial transaction tax, a mansion tax, a second home tax and a land value tax years ago.

@arethereanyleftatall
"Yanbu.
An £80k salary is knocked down by tax and the costs incurred with having an £80k job, to result in barely a difference in disposable income from a £15k salary which is topped up through benefits and added to with free this and free that."

This is utter bullshit. After tax someone earning £80k would come out with a monthly income of just over £4500.
Now I'm only on £10.5k myself, but with the tax credits, child benefit and the extra 15 hrs childcare I get (as someone on 80k would also get the first 15 hrs childcare) I get around £10k extra a yr (I'm not complaining, I know I'm very lucky to live in UK and get this extra help), but let's say for arguments sake that a £15k earner also got the same (though I imagine they'd get less because they're earning more). That would still mean their monthly income would be approx £1950 p/m.
£4500 after tax a month is drastically more than £1950 wouldn't you say 🤔

Obviously I'm basing this completely on my circumstances of being a single parent with one child who is currently in full time nursery. But you get the point, your presumptions are extremely incorrect.

@AnoukSpirit totally agree with your post about the point of society.

Taxes are too low, would be happy to pay more to ensure the survival (god forbid even the improvement and expansion) of our public services (which would crumble tomorrow if not for the near endless goodwill of many staff).

Why would anyone better themselves? Implying a better self is linked solely to a higher, more taxeable salary? Not improving your education, retraining in a new field, contributing more to society/community/family/friends, learning a new skill or changing your life for the better in a way NOT linked to money? Yeah, I don't know why anyone would want to do those things

Personal taxation is way too low for what people expect back. People really don't appreciate the cost of services they get for free. How often do we read on here "DF paid tax all his life and now has to sell my inheritance"?

The bigger issue is tax avoidance. Too many companies and high earners can afford to dodge their tax responsibilities.

Well, with the number of health conditions I have, pretty sure that in the US I'd spend more on health insurance than I currently pay in tax.

Ok, @summerisdone.
So, using our own 2 particular cases as examples;

My dhs £100k salary is £5.5k per month after tax but about £3.5k per month after his extra costs incurred (see my post of 22.30 ish)

Your £15k example ended with £2k a month

So, from an £85k difference in salary, or £7k per month, there's a £1.5k actual difference.

Enough to make a nice difference to quality of life indeed, but not the massive difference people perceive.

And that's before the £15k family get free school meals, free dentistry and whatever else.

Anyone who thinks we could possibly have a higher tax system and Scandinavian-style benefits is deluded. It isn’t going to happen. Norway has the highest sovereign wealth fund in the world and like any country it has it’s own unique resources and demographic make-up. If the UK were to be a truly rich nation it would have happened by now. We were given the gift of the industrial revolution and oil, but expected both to last. The great British disease of resting on our laurels.

@arethereanyleftatall

Your example, though, is not typical.

My manager, earns £80k.

No professional fees or subscriptions or CPD required.

Your DH is a surgeon which obviously has requirements many jobs don’t.

But if he didn't have to pay the additional fees then that difference would be even bigger.

What were saying someone in a normal job with no professional licenses earning 80k is miles better off then someone earning 15k.

The tax system is fine here for everyone except those at the very top who go out of their way to avoid paying any. I wouldn’t live in America if you paid me .

A family on 15k don't get free school meals. Once you are employed, you're not entitled to free school meals.

An £80k salary is knocked down by tax and the costs incurred with having an £80k job, to result in barely a difference in disposable income from a £15k salary which is topped up through benefits and added to with free this and free that.

Says someone who has never earned a 15k salary.

I work part time and earn around 19k per year. No benefits except child benefit. On my highest FT salary, I earned 34k. The difference in take-home pay was around £1000 per month.

I would willingly pay more tax if it meant better investment in public services. Society needs people who are willing to do the lower-paid work. Education and the NHS are run on vocation at the moment.

How many of those low pay workers are childminders looking after your children so you can attend your highly paid jobs.

Would you be happy to put your money where your mouths are (some of you) and pay them more so that they then dont have to claim those in work benefits that you begrudge them so much.

@arethereanyleftatall

Your example is idiotic, to be honest. First, those costs ought to be covered by your OH’s employer. But assume he’s some sort of freelance surgeon.

So he actually earns £82k. (A bit more because he can claim back tax on the expenses). £82k is £4.7k pcm net of tax. £15k is £1.1k.

You don’t get “benefits” to make up the £3.5k. The take home is 4 times higher on £82k. The two simply aren’t comparable.

Or the shop workers paying extortionate taxi fares so they can get to work on Boxing Day and earn a wage that will be cancelled out by that taxi fare so you can hit the sales.

I do think that those earning more than 100k should pay more or we need more bands & Im not necessarily against a small rise ringfenced for the NHS however I think tax is quite high for those earning 50-100k simply because the cost of living is so high.

If your on 50k & are 50 having bought your property 20 years ago tax rises will be a lot more palatable vs a 30 year old who’s renting & won’t receive a state pension until they are in their late 70s & likely won’t have a free NHS. Wealth tax not just income tax is needed imo as we have an ever decreasing tax paying population.

You don’t get “benefits” to make up the £3.5k. The take home is 4 times higher on £82k. The two simply aren’t comparable.

They are indeed not comparable but someone on 15k could be entitled to quite a significant top up in benefits eg, UC, CB & HB.

Virtually everyone says we should pay more tax no one though says how much. Should we all pay 50%, should it still be staggered maybe those earning over 50k pay 60%? Also everyone seems happy to pay more as it results in better services or it could mean more money wasted, extra managers and another payrise for MP's.

I don't see why the British government can't make money itself, selling weapons and oil

And which countries would you like the weapons to be sold to?