To think this is the WHOLE POINT of tax?

[wheresmymojo]

Daily Fail are frothing today that higher earners pay more tax, and lower earners get more out in various benefits than they pay in.

I thought even the DF understood that the entire point of tax, it's whole reason for existing, is to re-distribute wealth to some extent with the wealthier paying more so that the less wealthy can benefit from a better standard of living?

Have I missed something - are there people who don't know this is what tax is fundamentally supposed to do?

I mean, I'm being fairly genuine...are there actually people who think it's like a bank account and you 'pay in' to 'get out'?

Why don't you get any personal tax allowance @edwinbear ?

It’s taken away gradually between £100k and £125k.

If you chose to take a job which pays badly because it is your "vocation" as some have said or because you want easy working hours or because you want to live near family or you made some other choice which means you earn less - why should the state bail you out? Why should higher rate taxpayer subsidise your choice for an easy life/low paid job?Why when those who take a stressful job with long hours away from family and children and earn more pay more tax to maintain a living standard for those who arent prepared to make the same sacrifices?

If you pick a low paying job - thats your problem. Want more money then retrain or go where the work is. Stop taxing the grafters.

However did we cope before the introduction of 'temporary' income taxes after the war?

We were just a country of illiterate savages. Nobody invented anything, everybody got murdered at least twice a week, and we all had the plague.

However did we cope when I started work and the basic rate was 33%?

It’s taken away gradually between £100k and £125k.

So if you earn over 125k you have no tax allowance at all @Blossomtoes

Yes, I’d completely forgotten about that. Although I was a higher tax payer I never earned more than £100k so it never affected me.

@Dymaxion yep, that's correct. So it goes:

0-£50k 20% tax
£50k-100k 40% tax
£100k-£125K 60% tax (taking into account that you lose the personal allowance
£150k+ 45% tax

I'm not complaining, but just highlighting. The effective rate when people jump above £50k and lose their child benefit is even higher than 60% I believe.

Land is a finite resource and the social costs of land hoarding falls on the taxpayer i.e. having to house the people who can't afford housing. It is a cost to society. And it might as well be hoarding if you are selling homes aimed at a very different market to the locals.

Minimum wage is not necessarily easier. A minimum wage job are generally jobs that have low barriers of entry and hence pay less as a result. It has nothing to do with whether it is hard or easy. Most minimum wage jobs are harder than mine, i just sit at a computer all day long. I only get paid more because what is viewed as a decent wage that can attract decent candidates is different to what is viewed on mumsnet as a decent wage.

The reward for particularly difficult or dangerous jobs is generally higher than those which are not difficult or dangerous. Why do you think that could be?

This is rubbish. Many public sector jobs are difficult and dangerous -nurse, doctor, police, prison officer, probation officer. They are not well paid relative to the demand.

That's all there is to it then!

I'm not really sure what your point is. Most of those jobs feature within the most dangerous 10 jobs in the UK and yet you get paid far higher for less difficult or dangerous jobs. A police officer starts on 21k. You get more working in Aldi.

Police officers start on £23,500 and it increases rapidly. It's disingenuous to compare it to someone working in Aldi

Doesn't welfare also cover pensions?

Based on national living wage (minimum wage’s new name) from April, someone working full time at 37.5 hours per week would be paid £20,319
That’s the absolute minimum.

You can see why junior police, teaching assistants, teachers, nurses etc don’t think the relatively small extra pay is worth it.

@Parentandteacher so many public sector workers are so underpaid.
A real kick in the teeth benefits are going up 10% yet their pay isn't. That 10% should be across the board.

@Parentandteacher and after 2 years it's nearly £28K
It's lower because they are in the Apprenticeship now

A PC after 7 years service is on £43K. Whilst it might be low to start it's still a good career with a good salary even in the medium term

Keeping more of the money you earnt is not a giveaway.

@MrKlaw I've read that post about 3 times, the bit you are forgetting is the pension will be taxed when it's paid out.

If you mean the mid late 70s then NI was less than half the current rate (5-6%?), as was VAT plus rents and purchase prices were lower compared to average incomes.

Taxes rarely drop they just move around. In general tax on consumption is assumed to be harder to avoid and whatever the regime tax has always been largely optional for the ultra wealthy.

Whilst this is more or less true and its an anomaly which really should be fixed, I've yet to have someone turn down a promotion because their salary tips into that £100-125 bracket. And of course we get a lot more tax relief on pension contributions (which is frankly ridiculous).

Putting money in the hands of people at the bottom means that money is spent on goods and services which (mostly) raises more tax and keeps society running. It is the don't work/could work people that drives this anger and yet there are clearly bigger fish to fry in terms of lost taxation.

I was brought up in poverty with two working parents pre benefits and now have a decent income. I'm happy to pay tax and indeed happy to pay more if it gets spent on the right things and if corporations and the rich also play fair and if people don't take the piss.

but whats the effective difference?

Case 1 - you get 4k a year in tax relief from the government. yes this is money you’ve earned but the government is taking 4k less tax from you. Thats 4k less they have to spend on things

Case 2 - you get 4k a year universal credit. Thats 4k less the government has to spend on things.

In both cases the government has the same amount less in their tax pot for things they need to do.

I don’t mind tax relief, but by the same token I don’t begrudge universal credit

Yes, NI was 6%. That still meant that very poorly paid people had 40% of their wages deducted at source. While rents were lower, inflation was running at double the current rate, it was completely out of control.

Incidentally, I don’t think tax relied on pension contributions is ridiculous. It’s an incentive to people who perhaps wouldn’t otherwise make their own provision and of course the money is taxed when it comes out.

Relief, not relied!