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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Do you believe that rich people should exist?

425 replies

Bumpitybumper · 23/09/2024 13:21

Having read lots of threads on here, I am starting to wonder about the proportion of people that believe that rich people shouldn't exist at all and that policies should be enacted to ensure a more or less even distribution of wealth.

So out of interest and just to satisfy my curiosity please vote:
YABU - there shouldn't be rich people in this country and that wealth should be distributed evenly to the extent that people aren't significantly richer than others.
YANBU - rich people are a necessary (and potentially even desirable) part of society

OP posts:
MixedCouple2 · 25/09/2024 20:46

If all assets were taking into a account it would make it very off putting for these people to hoard money and instead keep money in circulation so the country benefits from it.
Taxed on all investments and assets grom extra homes, lands, livestock, jewelry. Etc etc.

Papyrophile · 25/09/2024 20:50

So I have one house, a third of an acre as garden, a dog and some fairly ordinary jewelry. Why should I feel like the target for a tax-raising government after 40 years of working? Because I am the easy tax target. I have more than many.

Papyrophile · 25/09/2024 21:05

I would like my DC to get off to a a decent start with a bung to buy a home from the bank of mum and dad, while we can afford it.

BlackShuck3 · 25/09/2024 21:10

Papyrophile · 25/09/2024 20:50

So I have one house, a third of an acre as garden, a dog and some fairly ordinary jewelry. Why should I feel like the target for a tax-raising government after 40 years of working? Because I am the easy tax target. I have more than many.

The very wealthy people use their money & connections to make sure their money & assets cant be touched by gvts. So gvts go for the easy targets, the ones who dont have the ability to fight back.

Papyrophile · 25/09/2024 21:15

Rules me right out then!

Papyrophile · 25/09/2024 21:19

MN is my fight back. By presenting well argued posts, I hope to balance the discussions and moderate (a bit) of the extreme idiocy.

blubberball · 25/09/2024 21:23

There should probably be a cap on it. No one needs to be a billionaire

Papyrophile · 25/09/2024 21:29

No, noone needs to be a billionaire, but tell me how you'd cap it off..........? Money $$$$$ is how we keep the score.

Ellen2shoes · 25/09/2024 22:20

There are many more children living in poverty than there are billionaires with more money that they will ever need or spend.

Doesn’t that answer your question?

HaddyAbrams · 25/09/2024 23:32

I went to Nuffield Place today and learned that William Morris, Lord Nuffield (the founder of Morris Motorcars, not the wallpaper man) donated £30million in his lifetime. This is the equivalent of £700million in today's money.

It includes donating an 'iron lung' to every hospital that asked for one. Over 1,700 of them were donated thanks to him.

Unfortunately he also funded Oswald Mosley, but I guess even the most philanthropic people aren't perfect!

Fescue · 25/09/2024 23:34

Papyrophile · 25/09/2024 20:43

@MrsSkylerWhite that's the question none of us can answer definitively. There are posters who think that if you earn £40k and have a pension you are rich, because they are on NMW and UC. And people who earn £250K plus bonus managing money in the City. And Russian oligarchs who raped their oil and gas industry after Boris Yeltsin croaked who swank aound immune from any rules. Leaving those crooks aside, you could think DH and I are rich. I would agree that we are prosperous now, at 68, after 45 years of work, and saving. We have a nice house we bought a long time ago, and we have savings and a SIPP that is working well right now. We are just about worth £1.5 million in property and cash after all those years of work. Neither of us inherited money, so it's all our earnings. But if we need care, we shall be expected to pay for it, and we will, cheerfully because we shall have a choice of where we end up. Losing the WFA does not present a problem. I can afford the oil and the logs (no gas supply) to stay warm.

My trepidation is around the new Government's wish to tax the rich. It's actually very very difficult to tax the ultra-rich who only alight briefly and flit off elsewhere. I fear that the Government will set their sights on the settled well to do middle class, instead. We're a much easier target and we have fewer options for flight.

I think your post has pretty much nailed it. Even wealthy Middle East families have financial budgets.

The main problem with tax is that only a few people decide what is rightful. Just a handful of people decide whether to take £800 billion or £1tn from 68,000,000 million other people. We know that collectively we have to fund critical things like firefighters, emergency medical care and defence, but beyond that there is a whole layer of mission creep that individuals in or with ties to government promote. A bigger Big State equals a bigger trough and there is little difference between Eton cronyism and Socialist rackets. They have their own similar agendas, just different forms of capitalism.

There is nothing moral in taxation per se and the Courts have said this, time and time again. The only morality comes in its reciprocity. One could argue that if a person has built substantial wealth in property, it is because the social, legal and economic factors the state has fostered have enabled such wealth in the first place, then it is proportionate to pay that back on death through taxes. But using those factors in the first place, to create wealth is what the state needs. It cannot do it alone and the state needs entrepreneurs.

What genuinely surprises me is Starmer's modus operandi since coming to power. The PR and impetus beforehand was looking good. Not quite 1997 today, but that would have been a hard act to follow. Strip that away and we were assured earlier this year there was some messiah with the power to make change.

Yet here we are and there is an arrogance in the air that was not around then. Blair was about allowing people to reach their potential and making their own riches, whether money or otherwise. Then, it was all about unfettered opportunity, giving working class and poorer people the same opportunity as those who were already entitled.

But from Starmer it's not really about empowerment. It is quite the opposite. It is about making an even bigger state and giving collective power to the unions and central government.

And more than anything, false promises. If the £3 trillion public debt is to be reduced, or at least £2 trillion of it to bring it down to the £1 trillion left by Labour in 2010, how are they to do this? We will shortly find out, but so far we have been told no cuts in spending. That only leaves taxation, but there will be no increases to income tax, national insurance, VAT or corporation tax according to Rachel Reeves. And crucially there will be no new wealth tax.

Well, let's consider that for a moment. The central government taxes that are not going up contribute 86% of Treasury receipts. Take those out and the next one on the list is fuel duty which raised last year about £15 billion. Attack that and inflation goes up and jobs are lost. SDLT raised £11 billion, but if you increase that the price of houses goes up and the market collapses and 300,000 houses a year do not get built. Local government is off balance sheet, but the same rule applies. Increase council tax and it sucks money from other spending.

No more borrowing. No cuts in spending. No increases to the taxes that make the most difference. It is not clear how the £22 billion annual black is going to be fixed. Even if it was, that £22 billion, when it is found, just about keeps track with inflation on last years total tax receipts.

Starmer and Reeves are not going to do this alone. They need the support of business to grow the UK and reduce debt. But so far the message has not just been poor or unclear. It has been diabolical. It has been arrogant. Why? They have won the election. Now it should be about winning friends and influencing people.

It is not the fear of taxes that is, and will continue, to export wealth and ability overseas. It is the arrogance, lack of engagement and lack of confidence that makes people cut and run. Nobody wants to be in a race to the bottom. Then everyone loses.

Lavender14 · 25/09/2024 23:41

LivingDeadGirlUK · 23/09/2024 13:23

I don't think either of your options are correct, what most people want is a smaller gap between the richest and poorest. We don't think poverty should exist.

This^ I think yes people are of course entitled to wealth that they have worked for, inherited or won etc but I do think there should be a proportional responsibility for those who have more to contribute more to the society they live in via taxes in order to help decrease poverty.

Ultimately what we need is solid policy level changes that can help create more robust services to eradicate poverty in a sustainable way. There is a lot of money wasted in burocracy and red tape while vital public services are struggling. A major overhaul is needed.

Evilartsgrad · 25/09/2024 23:50

Papyrophile · 25/09/2024 21:29

No, noone needs to be a billionaire, but tell me how you'd cap it off..........? Money $$$$$ is how we keep the score.

What 'score'? I hope to God you don't mean " who is better than whom?"

Evilartsgrad · 25/09/2024 23:58

Deboragh · 25/09/2024 17:25

Yet you could guarantee that these jealous types buy lottery tickets every week, if they won it wouldn't count, like you say the politics of envy just eat these people alive.

Nope. Although I'm sure it's very comforting to believe that everyone who disagrees with disproportionate wealth is ' just jealous' ...

Childfreecatlady · 25/09/2024 23:59

This reply has been hidden

This reply has been hidden until the MNHQ team can have a look at it.

Childfreecatlady · 26/09/2024 00:06

MerryMarys · 25/09/2024 20:06

There are wealthy people who use their wealth for the benefit of society and to make the world a better place and those who accumulate it and sit on it.

What about those who work hard, therefore contributing to society through their work and by paying taxes, and then enjoying their wealth?

Yep, exactly. The highest tax payers usually get the least benefits from those taxes while the lowest get all the benefits. Of course the lowest payers will continue to scream for higher taxes and less rich people, BC they don't pay into the system yet reap all the benefits.

Orders76 · 26/09/2024 00:11

Super wealthy is different to rich.
I believe massive corporate profits or family wealth in the billions should be taxed.

If my friend is a dole for life, and I work hard and have assets of a house or small savings..... I should allowed be 'rich' without the gov distributing my money.

Usually the problem is that everyone considers others rich.

Krampers · 26/09/2024 06:31

cardibach · 23/09/2024 22:42

‘Bleat’? What an unpleasant way to describe someone giving their opinion. The NhS only ‘wants’ us to use private more because of underfunding and massive lists. Fix that.

You can moan all you like but I am stating facts.

Barbadossunset · 26/09/2024 12:31

but I guess even the most philanthropic people aren't perfect!

This makes me think of the cancelled philanthropists such as the Sacklers. Such was their largesse that one museum had their name carved in stone at the entrance to a gallery.
However now the neediest charities wouldn’t accept a penny from them.

Not sure what I feel about that - the money is helping a good cause so take it, or such tainted money should never be accepted?

BIossomtoes · 26/09/2024 13:53

Papyrophile · 25/09/2024 20:09

@Blossomtoes, so where do you draw the line between a small entrepreneur and a small company?

And if a small company prospers, and grows, do you redraw the framework?

You are a regular poster here, our politics are not so different and I trust your integrity, so give me a pen picture of where the balance tips. It's unlikely to upset me because I am fairly certain I won't fall foul of any rules you'd invent, but I am very interested in how you would frame a workable tax environment.

I’ve thought about this a lot. You divulge quite a lot about your circumstances so I think it’s fair to say you’re comfortably off as a result of starting a successful business in a pretty deprived area where there has been quite a lot of benefit to the local economy. I know you pay your people well, provide good working conditions and I also think you’re pretty meticulous about paying your taxes. Essentially I don’t have any problem with people like you and, to be brutal, you’re not particularly wealthy, you’re well off.

This report is interesting. https://www.lse.ac.uk/research/research-for-the-world/economics/how-much-tax-do-the-rich-really-pay

One of its key findings is

A one-off wealth tax on millionaire couples paid at one per cent a year for five years, we found, would raise £260 billion.

That would have a huge impact on the UK economy and not much impact on the people who paid the tax.

It also found

Using anonymised data from personal tax returns, we show that in 2015-16 the average rate of tax paid by people who received one million pounds in taxable income and gains was just 35 per cent: the same as someone earning £100,000. But one in four of these paid 45 per cent – close to the top rate – whilst another quarter paid less than 30 per cent overall. One in ten paid just 11 per cent—the same as someone earning £15,000. The rich, it seems, are not all in it together.

Just making everyone pay the same tax and removing loopholes and cliff edges would, not only create a fairer society but a wealthier one.

My real issue is with the kind of wealth that’s beyond the dreams of you and me, earned from other people’s work and hoarded. Globally there are individuals who, if they followed the Gates’ and Buffet’s example could solve a big chunk of the world’s problems at a stroke. Not only do these people fail to give any of their money away but they evade taxes in every way possible. For me great wealth brings great responsibility and they’re turning their backs on that responsibility. I’d like to see global taxation and the major governments allied to prevent tax evasion.

Sorry about the essay! And at the end of all that I suspect I haven’t even answered your question!

How much tax do the rich really pay? | LSE Research

Read about research from LSE’s Andy Summers and Arun Advani on taxation, how much the rich pay and whether the UK should have a wealth tax?

https://www.lse.ac.uk/research/research-for-the-world/economics/how-much-tax-do-the-rich-really-pay

MerryMarys · 26/09/2024 14:47

Interesting article by the LSE.

Some points that stood out for me:

-the UK tax system already looks top heavy. The top one per cent pay 30 per cent of all income tax revenues: a higher share than at any time in past twenty years. In other words, three in every ten pounds that the government receives in income tax is paid by just over 300,000 individuals.

-the idea of a 'wealth tax' needs to address a lot of factors: Who would pay it, and on what wealth? How would it affect incentives, for example to save and invest? How would we value assets? What mechanisms would be available for those who have low incomes relative to their wealth? How much revenue could it raise? How would it impact wealth inequality and the creation of wealth? Is there any need for a wealth tax in addition to existing taxes? And would the public support it?

In other words there are lots of important aspects to consider otherwise there could be unexpected consequences. Unfortunately i don't have the perfect answer either as to how to make the UK a more equal society

Papyrophile · 26/09/2024 20:22

Thanks for your response @Blossomtoes. Your appraisal is accurate, we're prosperous rather than minted and yes, all our tax is paid in full.

My take, IMO opionion, it would be better for society if we went back to taxing household income, so small children could be cared for by a SAHM with the basic threshold tax income threshold doubled to account for for the non-earning partner, so a couple with a child/children under 5 would not pay tax until their joint income topped c £26k (ie 2 x 12570). Which was how it was before 199-something, when HMRC decided to tax everyone as individuals. As always, some lost and others won. ANd there will always be lawyers and accountants looking for ways to beat the system.

Papyrophile · 26/09/2024 20:27

I suppose @Blossomtoes, that I have qualms about where the politicians will draw the line between modestly prosperous (like you and I) and minted. Being more than a bit cynical, I fear that we are just the easier geese to pluck. And, that does ruffle my feathers!

Fescue · 26/09/2024 20:56

Papyrophile · 26/09/2024 20:22

Thanks for your response @Blossomtoes. Your appraisal is accurate, we're prosperous rather than minted and yes, all our tax is paid in full.

My take, IMO opionion, it would be better for society if we went back to taxing household income, so small children could be cared for by a SAHM with the basic threshold tax income threshold doubled to account for for the non-earning partner, so a couple with a child/children under 5 would not pay tax until their joint income topped c £26k (ie 2 x 12570). Which was how it was before 199-something, when HMRC decided to tax everyone as individuals. As always, some lost and others won. ANd there will always be lawyers and accountants looking for ways to beat the system.

Nigel Lawson introduced independent taxation in his March 1988 Budget stating it would be effective from 6 April 1990. It cost HMT over £0.5 billion in the first year.

For a few years H would keep the married couples allowance but could transfer to W if elected.

Lawson was the most influential Chancellor in modern history.

Getofftheloosam · 26/09/2024 21:08

I don't give a flying f* about rich people and whether or not they should exist.
They need to realise that under the conservative government of the last 14 years they have been cushioned against austerity on the backs of the poor, disabled, chronically sick and children.
They need to stop whining just because there's been a change of government and they are not going to be top of the government's priorities.

As the Brexiteers used to say "you lost, get over it"

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