Trickle down: To ask higher income earners...??

[venusandmars]

Following on from the budget announcements today which disproportionately benefit higher earners (particularly anyone earning over £150,000 pa), if you have a higher income and will therefore benefit from the tax changes, how will this really impact on your spending?

Will you actually spend more on local services (more coffees out in a locally owned cafe)? Will you increase what you pay your window cleaner? Will you donate more to local charities or spend more time volunteering? Will you make voluntary contributions to HMRC? What WILL you do with the extra money?

OK, I know IABU asking people to account for their choices, none of us know the financial pressures that higher earners might be under, but it seems to me that the whole 'trickle down' economic theory is completely flawed. So little of that additional money is going to be seen by lower earners - and almost none to those who cannot work.

I'm not in the +£150K bracket but I have enough when I know others are really struggling. I have increased what I pay my window cleaner. Over the next 4 months I will use my 100% of my energy payment to donate to local foodbanks. It's small stuff, nothing heroic.

I am despairing about the tax announcements today.

I thought the benefits of trickle down had been debunked years ago!

It's going into the savings to replenish that after some large expenditures over the last year, and to overpay the mortgage.
I'm disgusted by this budget entirely.

The whole thing makes me feel sick to my stomach. We're not in that bracket (and quietly shocked by how many mumsnetters are to be honest!) but we're comfortable and I would be able and prepared to take a hit for those who are seriously struggling. To hear people will benefit from today's announcement to the tune of £40k or more is utterly grim.

The extra money will just go into savings/investment fund. I already buy locally and try to trickle our money down but it's highly unlikely this will help much

My base salary is only just into that pay bracket, and DH earns a fraction of what I earn. However it will affect the tax I have to pay in my bonus, which will make things easier for us- don't need to be as worried about our fuel bill (just moved into a much bigger house) and can spend a bit more on decorating etc.

So we will feel the benefit. But will feel guilty about it too!

We are this bracket, it will mean we give our cleaner a pay rise in January (as we normally do). It means we will buy a new car rather than a second hand new to us one. It means we will keep buying coffee on the way to work and lunches out rather than not doing, which is what we were discussing. Not big things but some things.

We are in this bracket. I earn £20k and will donate the increase I get to charity.

DH earns 200k. It means we can pay off some debt, pay for a holiday and donate to charity. We will be spending more- local travel agent, flights with a UK airline and staying in the UK. Also planning to buy DC a new bike and will go to the local bike shop for it.

We don’t have a cleaner or a gardener or a nanny to pass on the pay rises to. School fees went up 5% for this academic year already.

Thats an icome of £750k for 1 person pre tax.
Just too set in context for other readers.

Most people i have heard about who earn six figures just end up buying property abroad or siphon it off elsewhere.

I think the other point is that even if there is a trickle down effect, it is so incredibly localised.

I live in a wealthy enclave of SW London where it’s already a little bit of a joke how you can tell how good bank bonuses were on any given year by how many builders hoardings go up outside houses which are about to get a basement extension or renovation

Abercrombie and Kent will probably get a boost
And the local land rover dealership will do well

but how the living fuck is that supposed to help anyone in Wakefield or Chatham or any area that actually needs investment and support and government money spending

It’s not even particularly self serving because those benefitting from the tax cut are already overwhelmingly Tory supporters rather than floating voters who need buying ahead of an election

It is the dumbest budget in my memory, by a long shot

On £200k it is £5219 a year- not sure how you are going to do all of that!

I know many people on the higher rate tax of 45%- every single one is PAYE and pay their full tax and NI requirements. No siphoning of any kind at all.

Yes, I will. I go to local cafes daily and spend money. I had planned to cut back with everything rising but now I'll have a few more ££s, I'll carry on.

I'm not a higher earner compared to many (£70k) but I have a huge amount of equity in my home and am planning to sell in the early new year and buy somewhere bigger with a garden. The money I'll save through stamp duty I'll spend on doing it up using local businesses.

Its fucking madness.

DH and i will both benefit. We have bloody loads of money already, we are not short of cash to spend if we chose to.

More money just means more savings or more money spent on a larger house, neither create jobs etc and anything propping up the horrendous house prices us clearly a stupid idea.

Trickle down/supply side economics do not work.

If your economy is a £1bn pie and each of your population of 100,000 gets £10,000 share of it, that is a better outcome than if you have a £3n pie and the richest 1000 people get £2.5bn of it - everyone else only gets half as much.

Economic growth is only a reasonable target if everyone is getting a fair share of it.

I definitely won't be making voluntary contributions to HRMC 😂

We will be around £1800-£2000 better off under the tax cuts. We will keep our dog Walker, planned too anyways.
Don't have window cleaner and don't have domestic cleaner.
The money will be spent in the pub more than likely on food and drink.
We're doing a renovation so will support with this. Ours plans won't change as the £2000 isn't a huge a change to our disposable income per annum.

I'm unsure what the point of the cuts are other than to Americanise the UK with low tax and a huge poverty problem.

On 70k it is £20 a week gain.

The80sweregreat
DH and i are both on 6 fig. Im currently in the personal allowance clawback so paying very high effective tax. Im a standard paye employee, nothing whatsover abroad etc.
DH is over the 45% band. He also has nothing abroad and is standard PAYE.

We have lots of friends on high income, we are all PAYE.

@NonPolitical
4 night trip to Edinburgh c.£1000
kids Frog bike c.£400
charity donation DH £2000
rest on debt.

Does that help?

What utter rubbish.

This is more likely for a 7 figure income.

DH earns 200k. It means we can pay off some debt, pay for a holiday and donate to charity. We will be spending more- local travel agent, flights with a UK airline and staying in the UK. Also planning to buy DC a new bike and will go to the local bike shop for it.

On 200k your DH could already afford to do all those things so will it really be NEW spending?

Tough one. Also not anywhere near the +£150K bracket but a big extra will probably mean I will get hair coloured by my hairdresser rather than diy. But this means diverting a cost from one business to another.

I already try to buy UK produced products as much as possible for environmental reasons but also cutting back on clothes & possessions.

May be more inclined to stop at a cafe but nothing significant. Keeping Netflix- does that count?

Might consider a winter gym membership though.

I’m not sure. The change doesn’t come in until April. It certainly won’t make us feel richer as we have a large mortgage on which the repayment will basically double. it does however make me feel more comfortable about some of our non- essential spend on cleaning, gardening etc and our charity donations. Possibly we might have a slightly nicer holiday?

Wherever a few people like us chose to splash a few extra grand will not make up for billions lost in tax revenue. I suspect, but haven’t thought it through yet, that the way our financials work out means that the pound tanking will provide us with much more benefit than the tax cuts which have apparently caused this.

it’s utter ideological madness. I don’t want to live in a basket-case country. I use schools and hospitals like everyone else, I want them to function and I’m happy to pay more tax to fund them.

It will fund a decent pay rise for our nanny and our cleaner.