To think the 'Net Contributors' argument is just wrong?

[Yetmorebeanstocount]

Just been reading about "Net Contributors" of tax and how it supposedly is a bad thing that we don't have enough in this country.
i.e. - that most people receive more, in cash benefits, social care, NHS, police, education, roads, bin collections etc. etc. than they will ever pay for via their taxes, so they are 'net recipients' of the system rather than 'net contributors'.

My reaction is - well yes of course. That is how it should be!

Take a very-over-simplified example to illustrate the maths:

Say there are 100 people who earn £1k, and one person who earns £200k. Say the 100 pay no taxes, and the one person pays tax at 50% of £100k.

That tax gets re-distributed to the 100 people in the form of services and benefits and pensions, so that the 100 now have the equivalent of £2k each and the one person still has £100k.
What is supposed to be wrong with this? It is just basic re-distribution of income, which is something that every civilised society should do.

Of course in real life people earn all sorts of amounts and receive different things, so it is not so simple, but the principle is the same - a few at the top are 'net contributors' and the rest are 'net recipients'.

And of course, those at the top still get something back as they drive on roads and have their bins collected, and have the benefit of living in a civilised society which is policed and (mostly) does not have people dying on the streets.

Also the top 10% of tax payers pay 60% of all income tax. How much further you could push this is debatable.

People also contribute in other ways. The state would collapse if everyone was paid the going rate for their work/volunteering in state services.

... And their reward is a government pushing them to take the jobs left vacant by EU migrants with the threat of removal of benefits if they remain unemployed.

I suppose the high earner in that example is pissed off that their salary is subsidising 99 people’s lifestyle. Within that 99 there will be those who cannot do without help, but there will also be those who are getting non means tested benefits when not needed or those who are feckless and can’t be arsed to do better.

if the high earner decides they are sick of the state of the country and decide to leave and live elsewhere what happens to the 99 people then?

Personally I think we should be more Denmark.

Working welfare state, decent healthcare, and everyone is pretty happy to pay taxes because they get a decent service.

Most of the really wealthy pay little or no income tax. There is such a lot more to taxation than income tax.

Denmark - population: 5.857 million
UK - population: 67.33 million

More people live in London than in Denmark.

You mean 10% of income tax payers pay 60% of income tax.
Other taxes are available.

If most of the real wealthy pay little income.tax how come the top 1% pay 34% of income tax?
Of course there are many types of tax but income tax is a decent illustrative measure and one of the hardest to avoid. The super wealthy will have more complex tax arrangements but you only need to earn 59k to be in the top 10%. People at this level would not consider themselves wealthy or have complex tax affairs.

The issue is more the ageing population & the shrinking working one plus tax is weighted quite heavily on income eg paye then other vehicles or assets which is making it hard to build wealth not to mention yrs of stagnant wage growth.

Well no. It's shit. The tax burden shouldn't fall on a small proportion of people while most just take.

As it should be. Everyone who physically can work should be doing so, not turning up their noses at basic jobs. Or go hungry, I couldn't care less. But not be rewarded by picking the pockets of actual workers.

Or just not vilifying the people who support most of the country

Edinburgh during the bin strike. Dire! Gross 🤮 Really made me appreciate how fragile society is.

@LaurieStrode if you had ever been unemployed as I have you would know you get pushed into any job already.

There are some very serious macro issues facing the UK, principally driven by the lack of growth over the last decade

yes & I think things are only going to get worse

Are you really suggesting that if people don't pay taxes because of their low income then they somehow won't feel part of society?

A strange way to look at the relationship between people and their society.

Doesn’t matter what you earn in Warrington , your bins won’t be collected. Lazy bastards are sat on their arses all day being funded by the Union.

The super wealthy will have more complex tax arrangements but you only need to earn 59k to be in the top 10%.

But the super wealthy aren’t on paye

You have answered your own question really - only wage slaves are unable to dodge income tax. If most of your wealth doesn’t come from working you don’t pay much income tax. Rishi pays about 20% overall, but he’ll be paying at the top rate on his PM salary.

Exactly - in many cases their money isn’t even here (UK) they just live here.

Of course there are many types of tax but income tax is a decent illustrative measure and one of the hardest to avoid.
It’s a piece of piss to avoid income tax if you have a stack of wealth.

My point is there are a lot of people on modest incomes paying a huge slice of the tax take. The numbers of truly super rich are relatively small and their wealth more mobile.

Deliberately completely misses the point of the thread

But if you tax dividends at the same rate as income, why would anybody invest in shares, and provide investment to business? Why take the risk?

Because you would still likely get more than stashing it in a bank savings account.

There is an argument that if one small cottage is sitting on an acre, that is not good use of land, and is a luxury for which the occupant should pay. If they can't afford it, they can move out and several homes can be built on the land instead. Better to do that than develop housing on green fields.