To not want my children to pay for tax cuts for the middle-class?

[antelopevalley]

A new policy proposal to increase the ceiling for higher rate tax for individuals has been proposed so that it will only apply once you earn £80k plus. But there seems zero idea of how this will be funded.
Realistically the only way it will be funded is by increased government debt. Debt that my children and others will be working to pay off in the future.
Why should my children and others have to work in the future for tax cuts for the middle class?

Government borrowing should be for investment in the future. Building sources of cheap future energy for the future for example. It should not be used for short term political gains.

[Doingprettywellthanks]

I’d get on with them! 😂

[Quveas]

Where do you think all the existing government debt got paid from? Future generations have always paid for the past. I contributed to paying for two wars I wasn't even alive for! The rich get richer - and I don't mean those slightly better off - and the rest of us pay for them to get richer. If you want to completely revolutionise the way that government fiscal policies work, I'm all for it. But it'll need revolutionising a while load of other stuff. In fact, it'll need a revolution. Let me know when the barricades are going up.

[antelopevalley]

@Hawkins001 There are also commentators predicting a stock market crash. I do not know enough about this to know if they are correct. But without very good stewarding of the economy, there is going to be more business failure than usual.
So frankly I think anyone who does not hang onto excess money at the moment is a bit daft.

[Hawkins001]

@antelopevalley

@Hawkins001 And that could happen again. People have taken on large mortgages because interest rates have been low. They are rising. If they continue to rise we could end up with lots of people defaulting.

It's like the character in margin call said, when listing the number of financial crisis, it's like it's human nature for them to repeat every so often,

[MarshaBradyo]

Hawkins they are both excellent movies, The Big Short is probably my favourite movie - funny too. The book is good also

[Quveas]

@steppon

But it's ok for middle class high earners to pay shit loads of tax to provide benefits for people who don't work and have loads of kids!!??

tbf the stereotype of someone not working & having loads of kids is not really true.

Much as I hate to say it, because I fundamentally support a good benefit system ( and we don't currently have a good one) you clearly don't visit the areas I work in or anywhere near where I live, because it really is true! Not of everyone, no, but of enough numbers to make the belief viable. One of the basic "rules" of stereotyping is that there must be some evidential basis to support it. Otherwise it would get no traction.

[Hawkins001]

@MarshaBradyo

Hawkins they are both excellent movies, The Big Short is probably my favourite movie - funny too. The book is good also

That's very true, margin call I thought was the more serious one, and the big short did have some good moments, e.g. The dog doo wrapped in cat doo, etc,
I was tempted to get the book of the big short, but I wanted more academic style books,

[Doingprettywellthanks]

@antelopevalley

@Hawkins001 There are also commentators predicting a stock market crash. I do not know enough about this to know if they are correct. But without very good stewarding of the economy, there is going to be more business failure than usual.
So frankly I think anyone who does not hang onto excess money at the moment is a bit daft.

Do you understand hyper inflation op?

[Miajk]

@antelopevalley

And giving money to the well-off in an economic crisis does not help the economy. When this has happened the well-off tend to save or invest it rather than spend it. Giving money to poorer people does help the economy as they tend to spend it almost immediately in local shops.
The tax cut is a voter's bribe, there is no economic justification for it.

OP do you really believe someone on 55k or 60k, living in London, has kids, and a low earning partner is well off?

If so, you're out of touch and you don't have a clue. And why should we give a shit about your kids and who's taxes they will pay if you don't seem to care about anyone else.

We should be taxing the billionaires not normal working people who are having their income tax at stupid levels while getting no government support wverand always footing the bill for everything it seems.

[Madamecastafiore]

Yay, don't take into account that the cost of living affects those who pay higher rate tax and you'll find a lot more businesses fold. Restaurants, car valeting services, cleaners, gyms, children's activity clubs, cafes and farm shops to name but a few. It's the people that work or own those businesses which will also be affected and then perhaps have to claim benefits which they didn't have to before when those pesky high earners have to pull in their purse strings.

[Hawkins001]

@Miajk

OP do you really believe someone on 55k or 60k, living in London, has kids, and a low earning partner is well off?

If so, you're out of touch and you don't have a clue. And why should we give a shit about your kids and who's taxes they will pay if you don't seem to care about anyone else.

We should be taxing the billionaires not normal working people who are having their income tax at stupid levels while getting no government support wverand always footing the bill for everything it seems.

We need a competitive tax system not just grab from the mega rich, otherwise they just alter their finances, to avoid the taxs etc

[Booklover3]

The theory that wealth trickles down is all well and good if you are near the top right? A bit like a pyramid scheme…

[PerfectlyPreservedQuagaarWarrior]

@antelopevalley

I know they are not super rich. But in the past this group tends to be cautious during financial crisis. No one knows what will happen with mortgage interest rates or energy bills. Why spend money in local cafes when your mortgage payment may soar by November?
Sorry but I have heard too many times people arguing that in this financial crisis the rules/or the way people act will be different in the past for various reasons. It never has been. People always want to think this time is exceptional. But history does show us fairly reliably what will happen.
This proposed tax cut may buy some votes. It will have no impact on the economy or very minimal.

Actually, it isn't an argument that they'll behave differently this time, because the evidence that tax cuts to people in this specific income bracket only results in saving or investing isn't there.

What you're talking about is the demonstrated previous behaviour of people who in many cases will have a lot more, and then assuming it applies to what will in many cases be middle income households (our household income is low 60s, though between two earners so no higher rate here, and we came out between the 50th and 60th centiles on that ONS where do you fit thingy, so there would be scope for someone in the 50-80k bracket if a sole income household to be lower). You aren't wrong about what happens with people who have a lot of money and assets, but you're filling in the gaps assuming a single parent privately renting on 60k in London is going to behave in the same way.

[Capri3]

@Blossomtoes

Impossible. Benefits cover a maximum of two children.

The two child limit was introduced in 2017. Tax credits can still be claimed for all children born before then, regardless of whether a family have 3 children or 13.

[SeasonFinale]

@antelopevalley

Average earnings for an electrician are £30-£34k. I suspect your mate employs people, that is how you make a lot of money in the trades.

And isn't it a good thing that he employs people ?

[Magnanimouse]

The problem with government policy is that these things always come up in a crisis. Yes, if there's money to spare, this might be a strategy to stimulate the economy. But they seem to consistently wheel these things out at exactly the wrong times (I haven't got over the fact that in 2010 while imposing austerity, they still managed to cut inheritance tax - maybe worthy, but totally inappropriate at that time). This isn't worth getting into debt over.

The only reason for this policy is to win the next election.

[honkeytonkwoman38]

Yes let's penalise nurses and demand they do better for themselves. Not everyone wants to work for a bank!

[Ncvisitor]

@Magnanimouse I really disagree with inheritance tax.

You pay tax on it when you earn it and then you’d get taxed again just because you’re dead. It’s just means people get creative with how they gift things before they go.

[Magnanimouse]

@Ncvisitor I'm actually with you on that. Just pointing out that the worst financial crisis on record was an odd time to do it, while simultaneously cutting the pay of people cleaning your local hospital. You have choices about how to spend money in years of plenty; you don't have the same choices now.

The higher tax rate applies to many, many more people than before, and £46k+ (I think?) for a family living on one salary in London (and therefore no benefits or other assistance) is not "rich" by any means. But equally, now is not the time to be doing it while poor families are starving/turning the heating off.

[Blossomtoes]

Given that only a tiny percentage of estates pay inheritance tax, it really doesn’t bother me. We pay different taxes on the same money over and over again every time we fill our cars or buy any VAT non exempt goods. Big inheritances are usually as a result of rising property prices that have never been taxed.

[PerfectlyPreservedQuagaarWarrior]

The higher tax rate applies to many, many more people than before, and £46k+ (I think?) for a family living on one salary in London (and therefore no benefits or other assistance) is not "rich" by any means

50k I believe. There are actually some people who are entitled to housing benefit and/or childcare UC from the state whilst still being higher rate taxpayers, but that furthers your point really.

[Blankscreen]

The mega rich can avoid tax. Someone commuting and working in n a bank might earn £250k but they are not going to be able to live in Monaco and avoid tax.

Wealth isn't taxed. I listened to a really interesting phone in whereby a group of million have suggested an annual tax of 1.1% on wealth over £10 Million.

[Bluepiano]

@Ohdearthatwasntgreatwasit

We have to incentivise people to do better for themselves.

If you want to benefit from this kind of tax cut, be a higher earner. Admittedly for most adults the ship will have sailed by the time they become parents, but the idea is that you drum it into your DC that they need to do better at school, get better jobs etc to be earning at this level.

If everyone were earning enough to benefit from raising the 40% tax threshold, who would become a teacher/nurse/police officer/ firefighter etc? Those jobs are never going to earn close to the threshold, yet are pivotal to our society. I don’t think encouraging people to think money is the most important thing rather than jobs that benefit the community, is the right way forward. It just creates a more deeply ingrained extreme capitalist model of society.
Now, if people’s pay reflected how valuable their role is to society rather than how much money they make for shareholders and CEO bonuses….

[Elsiebear90]

I think it needs to be raised as 50k is really not a lot these days, you would struggle to raise a family on a single income of 50k in most parts of the UK. I work in the NHS (senior clinical role) and I’m close to earning 50k, I’m starting to seriously consider not picking up extra shifts later in the year, as I don’t think it’s worth working overtime for almost half my hourly rate. I also have significant deductions out of my wages for student loan and pension so it’s just not worth it from my point of view. I imagine a lot of middle earners feel the same, so there would be some benefits to society as it would incentivise people to work more.

[Dollyparton3]

Think of it another way, I'm a higher rate tax payer and in the past few years any pay rises I've had have been sucked up due to tax thresholds being held and inflation overtaking pay increases.

This year my pay rise was roughly 1.5%, inflation is into double digits. I pay a colossal amount of tax at the moment but the disposable income year on year has shrunk.

If you consider that recessions are driven by consumers tightening their belts in a tough economy that also ultimately drives a lot of businesses to fail and inflation explodes.

I've also not had the benefit of anything but the £400 fuel payment heading our way because our income is high and council tax band doesn't count. So yes the government is probably also considering keeping levels of disposable income in the economy that support a number of industries afloat as well as supporting lower income households. Surely that's fair on everyone?