Give everyone £48 and scrap the tax free personal allowance

[Cherrypi]

Sounds like a great idea to me. What does everyone else think?

www.theguardian.com/politics/2019/mar/11/scrap-tax-free-personal-allowance-and-pay-everyone-48-a-week

Far too sensible to ever happen, but great.

What would prevent it is hand-wringing "work hard" Tory headtheballs who think that workhouses should be reintroduced.

For anyone earning up to £125k?!

Similar to the universal income experiment which failed miserably in Finland.

Key question is - would I personally be better or worse off ?

Basic rate is 20% so assume the £12,500 is worth 20% , so thats £2,500.

£48 x 52 weeks is £2496

So if we are giving it to every adult, how is it being funed ? becasue the 20% income tax wouldnt cover it (only 1 in 4 adults pays tax)

So all we would possibly achieve is making shit loads of junior admin redundant in the civil service.

I think tax needs to be simplified not made more complex! They'd be a lot of people not better or worse off but they'd be taxing them and then paying them the money back; seems daft to me!!

I don't know.. it's so complicated. What would the basic tax rate be? I can imagine people working low wages p/t hours would feel that their effort was not equal to the reward if they were taxed 20% from the first £1.

so this is essentially UBI.

I didn't know the Finland experiment was considered to have "failed"?

I can't see any government handing out free money. It's a lot different than scrapping the personal tax allowance. Everyone who isn't working would get this £48.

How many people on here say they can't afford to work but would like to? If there was no personal allowance then there will be far more families where one parent (usually mother) can't afford to work when really they'd quite like to. I see lots of unintended consequences.

p.s. I'm not personally invested, i earn a middling ok ish wage but not higher tax bracket so i'm probably in the 'break even' either way group.

@Grace

In short, lazy people, stay lazy

www.independent.co.uk/news/world/europe/finland-universal-basic-income-trial-unemployment-experiment-trial-a8769621.html

www.bloomberg.com/news/articles/2019-02-08/finland-finds-basic-income-failed-to-boost-employment

www.theguardian.com/world/2019/feb/08/finland-free-cash-experiment-fails-to-boost-employment

@Museum

Assume the BR of tax stays at 20% - the tax on the first £12,500 (personal Allowance ) is £2500. They are then given this back at £48 per week - an annual total of £2496 , so a £4 deficit.

Trouble is every adult is also given £48 per week, irrespective of whether they are working or not, and this is on top of their benefits.

Giving people money for nothing never encouraged them to work. Quite the opposite.

Plain thanks.

I thought the UBI was to replace benefits as well, or at least partially, so I'm not surprised it doesn't encourage work, I must confess I thought it was aimed at easing admin etc

that said, I also thought it was too good to be true!

I probably count as a lazy person, I've gone freelance/part time when in theory, I could work full time.

@Grace - well that was the original idea - McDonnell wants to put in place on top of benefits, according to the Guardian article.

Load of bollocks. So jobseekers/those on benefits would potentially have more disposable income than workers? Yeah... Deffo going to work, that.

Those soley on benefits*

*solely bloody phone!

Silly idea. Yet another reason to stay jobless rather than working.

Dreadful idea . Reward everyone regardless of effort ? Bit like tax credits and the poverty trap that helped create .

Or you could do something REALLY radical like a 20% flat rate on all earnings. Proven to bring in more tax revenue, but unlikely to ever be suggested because it doesn't punish the "rich". In this case McDonnell et al are also suggesting "rich" ie: higher rate taxpayers, means anyone earning over £37,500.

@Silentsister - but it would be punitive on those on min wages, especially, say 6th formers or those under 24.

@purpletigers Im not a lover of tax credits, I'd do away with them entirely and make employers pay living wages. Thats radical !

PlainSpeaking Thank you. You have provided the answer as to why you have to have a tax free banding in the first place.

It'd quite suit me. I only do 17 hours a week and don't earn enough to pay tax on it, so the extra £48 a week would be really handy!

From the article:

it would also mean bringing down the threshold for higher-rate taxpayers from £50,000 to £37,500. This is because the starting point for 40% income tax moves with the personal allowance

So little incentive for anyone to earn more than £37.5k really.

Everyone who worked would pay tax but you'd be up if you paid less than £48 a week tax. I think it'd be good for students, homeless people, people on zero hours contracts.

@LakieLady
I think you've misunderstood the proposal (unless I have). Under this new proposal, everybody as soon as they earn anything would be paying tax. So, you would be taxed on your 17 hours.

It just sounds overcomplicated.

Why link removing the tax free allowance to giving money to help people that earn nothing or very little? Two different subjects. If the goal is to help some people, this is what benefits are for. If the goal is to increase taxation, let’s be honest about it. Not try to hide it behind the fact that most households will not be better/worse off.