AIBU to think that people with low income generally contribute more to economy than they take

[MagnificentDelurker]

Hi there
l mostly lurk as most of the time what I want to say is said much more eloquently by others. However every once in a while when the question of tax or benefits comes up someone comments as self evident truth that if you pay little or no tax then you are a burden. Some poster a while back went as far as saying unless you are high earner then you are a burden. While these views are challenged, they are not challenged enough.
Today a poster speculated that children of a particular family were likely to become adults on minimum wage and hence a burden. Do we really think that we can have a society full of bankers and lawyers?
Maybe if robots take over but seriously where do people think goods and services come from?

I assumed the thread was about getting off your bum and doing things for others (when I saw the title anyway).

I worked for a community charity and found that all sorts of people donated time, expertise, effort and money. In my experience though it was the more wealthier/comfortable who gave more of their time and pushed to set up kids homework clubs, breakfast clubs, worked in the shelters, courts, etc. I don't know their backgrounds though - maybe they had tough childhoods? I don't think they had more time than anyone else - or help at home. Maybe they just felt grateful to have a roof and food on the table.

However, in the local hospice I saw nurses who worked all week volunteer to do shifts or home visits.

I think everyone should volunteer. Most people don't know how much need their is in their own community. We have so many charities, drop in centres, hostels, refuges around where I live that people don't even know about.

@coloursthatweremyjoy you're also preparing the next generation to hopefully be positive economic units. That's an absolutely vital contribution regardless of the artificial financial value placed on it in terms of remuneration.

People on low incomes generally pay proportionately MUCH more in tax than people on higher incomes. Plus they spend their money, keeping the economy moving, rather than keeping it in offshore bank accounts where it does nothing to help anyone. Plus they often do the kind of jobs which society absolutely needs rather than the kind of jobs we honestly can manage without (hedge fund manager, anyone?) The economy and much else in society would fall apart without the contributions of low income workers.

I think people only look at the extremes here. There are very few people who earn enough to take advantage of offshoring and other tax avoidance. High earners who are employed (yes- the bankers, high earners in the city, the accountants, people who earn shit loads working for google) they don’t get to tax avoid. They are PAYE.

Then think of all the middle earners- the £50-100k ers- mainly working for companies, no opportunities.

Opportunities for tax avoidance or even evasion mainly affect the self employed, and there are self employed people at all levels

There are so many things where the cost doesn't reflect its true value - clean air, water for example; things we just take for granted. The workforce is no different, often the people doing the most valuable work are valued the least.

Caprisun

Yes you are correct and while I do believe we are in “this” together, the banker and the bin man; I also think a lot of high income would not be generated if it was no off shoring.

People on low incomes generally pay proportionately MUCH more in tax than people on higher incomes.

That's such a strawman. Yes, if you have less money, anything you do spend that money on that is subject to tax is automatically a higher proportion for you than someone who is higher paid. But that doesn't mean because someone low paid pays a higher proportion of their wages in things such as VAT that the overall level of tax they pay is bumped above other higher paid people, higher paid people still need to pay for the same things as lower paid people, and still pay the same VAT.

I'm not a low earner, I'm not rich either, but I still have to pay the same amount of tax on a tank of petrol, and my grocery bill as a lower earner, all the while after paying out X times more in income tax and national insurance contributions than they do. That's just the way it is, and would never change, not without something stupid like a tiered means tested VAT rate or something as equally insane.

Plus they spend their money, keeping the economy moving, rather than keeping it in offshore bank accounts where it does nothing to help anyone.

I love it when this point pops up, you'd think the amount of times people mention it, that we'd be awash with tax avoiders littering the street, I can't walk down the street without tripping over off shored tax avoiders. Meanwhile back in the real world, they are probably few and far between. The majority of the population are either low paid, or in the middle, and while the occasional high profile off shored tax avoiders gets the spotlight, that's all it is, a spotlight, it's not a representation of the wider population.

So anyone on low pay is a darling, keeping the economy turning by spending all their money, and everyone else is a tax avoider who's off shored themselves hording their gold, no-one in the middle at all?

Also, there seems to be a lot of conflation between society and economy in this thread, they aren't the same.

Biker how the hell do you separate economy from society? If people didn’t do jobs for social good or volunteering, caring etc the state would have to pay far more to fill these gaps.

People who spend more leave a bigger environmental footprint surely. Therefore they create costs they don't pay for. Eg. More air travel, higher gas and electricity consumption in bigger homes with huge fridges, freezers, more cars per household, quicker turnover of appliances etc instead of mending or making do, etc

Surely it depends on what you class as 'contribution'.

In purely financial terms then a higher rate tax payer with children in private education and private health insurance 'costs' less than they contribute.

However, it's also true that society desperately needs lower rate tax payers and NMW roles whether that's cleaners, hospitality staff, binmen, retail staff, labourers etc.

Both make a contribution
This. ^^

But if we are talking about contribution with reference to a thread about a famous very large family with 21 kids then that thread was talking about finances. Ultimately, a family with 21 children and 1 main income is going to be costing society more than they put in.

Thing about tax avoiders , there may not be many of them, who knows, but the sums are huge,

Not to mention the 2008 bailout. Billions went to the banks to prevent them collapsing.

Then there's the private companies who successfully tender for govt contracts, cream off the lucrative bits for th3 benefit on a few shareholders, make a hash of the other bits resulting in the govt having to step in.

This regularly happens, prisons, east and west coast railway, care homes to name a few.

“Surely it depends on what you class as 'contribution'.

In purely financial terms then a higher rate tax payer with children in private education and private health insurance 'costs' less than they contribute.

However, it's also true that society desperately needs lower rate tax payers and NMW roles whether that's cleaners, hospitality staff, binmen, retail staff, labourers etc.

Both make a contribution
This. ^^

But if we are talking about contribution with reference to a thread about a famous very large family with 21 kids then that thread was talking about finances. Ultimately, a family with 21 children and 1 main income is going to be costing society more than they put in.”

This is all irrelevant because very citizen take the vast, vast majority of their social benefit in the last 4 years of your life. A 35 year old with private healthcare and private schooling is Meaningless if they cost the NHS hundreds of thousands before they die, live in care, hospices, etc etc

There is also the issue of how well people look after their own health.
You might be earning £50,000 so just into higher tax bracket, but if you are obese, drink heavily etc then you will cost the nhs a fortune.

Compare that to someone on £40,000 who bikes to work daily doesn’t drink/smoke etc and generally ends up needing less healthcare for lifestyle related illness such as diabetes.

Does the holy grail of the higher tax payer seem oh so important in this circumstance?

Then imagine your £40,000 a year earner is a teacher, a good one. The value of their work will benefit the country economically and socially for decades, through the young minds they help shape.

Or they are a nurse or paramedic, saving lives, keeping people in good health so they can continue to work.

Then you have your £50,000 earner who perhaps works in a law firm in some capacity or a bank.
I doubt the impact of their work on society ripples quite as far as the lower earner in this example.

These are just examples and will range from the multi millionaire offshore tax avoiders, to people who actively avoid work at any cost when they are able, and claim anything they can.

I agree that everyone’s circumstances are different. But it illustrates the point that the economy and society cannot be separated and people’s contributions to the economy and society cannot be based on the tax they pay.

You might be earning £50,000 so just into higher tax bracket, but if you are obese, drink heavily etc then you will cost the nhs a fortune.

Not necessarily. Think how much the country will save when such people die young and don't need expensive car costs or NHS treatment for age related illnesses. Also, not all obese people have poor health. I've been obese since I was about 7, worked full time for 35 years without more than a couple of days off work sick per year, and have yet suffered no ill health, at the age of 54 - never a day in hospital, maybe see the GP once every couple of years or so. If I drop dead of a heart attack aged 60, I'll have cost the NHS very little and saved a fortune in age related illnesses.

My best friend has never earned more than 18K a year - she’s now 57. No children and worked constantly since she was 15. She’ll have paid in a lot more and ‘taken’ out a lot less than some out there due to having no kids.

Yet, her state pension for, say 30 years, will be a hell of a lot more than she's paid in tax/nic, plus as she gets older, she'll be using the NHS for age related illnesses and then probably need expensive care home costs. So over her life, by being a relatively low earner, the amount she's paid in will probably still be a lot less than what she'll have cost.

Income tax is not the only tax - now on a lower income I also pay VAT, insurance premium tax, council tax and many others. Everything I buy includes taxes in it's cost (as in transport costs, tax paid by producer companies for example)

Badbunny your one anecdotal example is irrelevant. the facts are if you are obese/smoke/drink too much you are more likely to require extra healthcare.
The demographics are that your life expectancy may not be that much shorter but you will be more likely to live more years in poor health.

You are more likely to have a heart attack age 60, be saved and need ongoing treatment and rehab.
And then treatment for the lifestyle related conditions you may develop like diabetes. Which is crippling the nhs currently.

Those services we need will not be run without low income workers.

I think high earners who look down on low earners need to remember this. If there’s nobody to work in supermarkets, you don’t get to eat your nice food or buy toilet roll to wipe your arrogant arse.

Funinthesun

* I* made this point on another thread.
Most teachers/nurses/paramedics/midwives/carers do not earn enough for the higher tax band.
Would anyone seriously like to tell them after they have delivered your child or saved your life or got your dc through Their exams, that they have taken more from society and the economy than they give because they are in the lower tax bands? How do you seriously put a price on their value because of the tax they pay?

But the OP says the economy not society, that's just simple maths, not a value judgement

How do you separate society and economy?
You can’t put a numerical value on it, but how much does a teacher contribute to the future economy for generations through the children they educate?
It’s not as simple as paying x amount of tax.
One teacher earning £35000 -£45,000 may have contributed so much more to the economy through their work, than someone on £50,000 who pays a slightly higher rate of tax on the small amount extra that they earn. But if they work in a bank, the impact of their work on the economy and society just won’t reach as far.
50 years after a teacher has retired their work will still be impacting the economy because of the nature of the work they did and those children will be now earning and paying taxes also.

It can’t boil down to simple maths.

Any takers for my theory of a few posts ago, that people with more disposable income leading lavish lifestyles have an invisible take from the economy due to the extra environmental damage they do? This can be on the local immediate environment as well as the global environment.

Not really Rogue, it doesn’t really follow that wealth equals more waste. Stuff is so accessible now- the worst examples of waste are in the cheapest shops

Could see your point rogue in two car families will create more waste etc.
But I also agree so much cheap plastic tat.
Furthermore if you have the money you may also buy things to last.
However it’s just all so difficult to measure as it’s individualised.
The only thing I think is anyone who honestly believes earning more than £46,000k means they contribute more on the whole to the economy is the definition of arrogant because it can’t be reduced to simple sums.

The trouble is MN hates anyone on a high income, anyone who they deem 'rich'.

What utter shit, if it wasn't for the low income folk they'd be stuck. In fact it's the other ways around - if the rich didn't go to work everyday, spending hours at work/years training they wouldn't need childcare or nurseries or child minders to look after their children.

Everyone pays the same tax (for their earnings). They pay the same tax on food and clothing, petrol, fags and drink. In fact the higher earners pay more. Someone on basic income keeps all their money, middle incomers keep 80p per £1, and the higher people only keep 60p per £1.

I don't know why MN doesn't encourage everyone to keep train and chose sensible careers, be aspirational and the best they can. I don't think I've ever read a post on here that suggests that. Just everyone moaning and saying the lowly paid street cleaners and childminders are the only essential employees, bless them.