To not be happy about paying this much tax

[Lovingthehamsterwheel]

Name changed to enable objectivity.
I just saw this new tax calculator that shows you how much tax you are paying in total, including all hidden taxes, council tax etc

For a Person on 75k a year, 44 percent of earnings go on tax.

10k of that is spent on welfare.

Am i being unreasonable to think this is absolutely a terrible time to be alive in terms of taxes in the UK. And it is no wonder higher earners are leaving the country.

tax.corgi.global/

But it's not about what YOU get in return is it? It's about paying your way in society. And right now maybe YOU personally are taking out less than you pay in but who knows what will happen in the future. Also FYI VAT is a backwards tax meaning low earners pay proportionally much more of their income on VAT than high earners. That seems pretty unfair to me

Do you think the other 99% don’t pay tax?

I think the nation will survive without a couple fewer greedy and entitled people that think their tax contribution makes them more important.

Really low earners will be spending more of their income on zero rated VAT items like food, children's clothing, public transport, etc., and lower rated VAT items like domestic fuel. They won't (shouldn't) be spending a large proportion of a small income on highly taxed stuff like alcohol, tobacco, takeaways, etc.

If you make tax deductible charitable donations I’m sure you’ve also got tax planning to avoid your children losing 50% of your estate.

It's not a couple though. There's a well documented "drain" of higher earning individuals and businesses leaving the UK. CGT receipts have fallen since the changes on non doms because so many non doms moved away! Tax revenues increased when special rules/reliefs were introduced to encourage non doms to move to the UK! That's just one example.

Likewise with the IHT changes - not just the farmer's tax, but also bringing pension fund values into the scope of IHT. It's caused a stampede of tax planning, setting up trusts, re-arranging affairs, changing wills, etc., to reduce the IHT due on estates once the new pension rules come into force. One of my clients was "happy" paying a thousand in IHT on his estate before the change, so didn't do any formal "planning" to avoid IT as he couldn't be bothered and didn't want to pay a few thousand in professional fees to do it. Now with the pension rule changes, the IHT will be a couple of hundred thousand - he's been working with a financial planner to change things around and now his estate will pay zero IHT. Well done, slow hand clap for Rachel.

Everyone has their own personal "tipping point" where they're "happy" to pay tax up to a particular point, but then something trips them over the edge and they make changes - often meaning they pay less than they did previously!

We need as many higher earners/rich people in the country as possible. Alienating them by forever increasing their taxes and providing ever reducing public services for them will eventually tip them over the edge to move abroad, especially those with families overseas, or professionals who can easily get jobs overseas often with far better pay and equally if not better public services.

But some people seem to value politics and envy and political dogma rather than looking at the bigger picture and seem to think that killing the golden goose is better! Basically lets drag everyone down as long as everyone is equal!

I agree with what I think you are saying that the political priorities generally don't align with the priorities of most of the population.

However, everyone putting a bit more money in the pot just doesn't work forever as a strategy. The tax bands and marginal rates disincentivise work, the loss of personal allowance at the higher cut off is just plain unfair. Lots of people are working less than they might otherwise because of the way the tax system is structured. A lot of higher earners are leaving/thinking of leaving/encouraging their children to leave because the balance has now tipped. I'm not a fan of Laffer but there is something in his idea. Apart from that, the second issue is a demographic one, too many old people being supported by two few young and also a greater population not working, because of ill health and disabilities. It's just not sustainable, unfortunately.

Your client could just spend his pension @Badbadbunny, wasn’t that the intention after all - to provide him with an income in old age? And he didn’t pay tax on that money on the way in, did he? It’s a classic case of wanting it all ways.

This is an issue. It means the people who say great they’re going will have to pick up the extra tax.

And from my perspective that’s fine. I’m perfectly happy to pay a bit more tax and if it means improved services.

@MeowCatPleaseMeowBack High earners are leaving though.

https://moneyweek.com/personal-finance/tax/where-rich-relocate-to

I can’t find the article I originally read about it but the 10,800 high net worth people who have left since Labour got in leave a tax gap that takes around 500,000 regular tax payers to cover.

We were a HRT tax paying household till DH joined me in early retirement last year. We have a few friends who have also taken early retirement. This and the previous Tories are raising private pension rules to make it harder. It’s not a tax thing for us it’s just a had enough of work thing though there is a knock on effect obviously, that’s 9 HRT out I personally know living off private pensions and investments, none claim benefits.

Welfare actually stops civil unrest, that’s just as much of a reason as to why we have it really well just as much as the altruism people think it’s all about.

Not at all. He's hoping to live long enough to spend his pension. But we all know that some people have a very short retirement because of illnesses such as heart attacks, cancer, etc and some people don't even live long enough to retire. Sensible long term retirement/financial planning covers all eventualities.

You’d be better off looking at what you DOnhave and appreciating how well off you are OP than what you don’t.

"Welfare actually stops civil unrest, that’s just as much of a reason as to why we have it really well just as much as the altruism people think it’s all about."
Exactly this. And universal access to healthcare avoids major disease outbreaks.
All of us benefit from people being "taken care of" not that people really are taken care of these days.
I actually find it really sad, selfish and short sighted the number of people who moan about paying tax as though the rest of the country doesn't bother. It benefits all of us.
(Yes we are HRT payers. And yes I'm happy to pay)

IR35 caused a lot of "mobile" professionals such as accountants, actuaries and IT consultants to move abroad to escape it, many becoming digital nomads. Imposing it on the NHS caused a shortage of locum consultants and doctors which helped cause the longer waiting lists etc.

I lost probably half my "personal service company" clients because of it. Though some have remained clients but living in other countries. One is a specialist accountant dealing with high value acquisitions and mergers. Previously lived in the UK, paying UK taxes, buying goods and services in the UK. With IR35, she moved to Portugal. Still working for the same UK firms, doing the same work, but now paying taxes in Portugal instead of the UK. Multiply that with IT consultants now living all over the World, still working for Blue Chip UK firms, but working remotely. Multiply that by a couple of actuaries, still working for UK insurers but one living in New Zealand and the other living in Canada.

My son is a graduate actuary working for one of the largest insurers in the UK. Nearly all his cohort plan to leave the UK once they've qualified. Nearly all the leavers do's he goes to are from young workers emigrating.

It's a massive problem and I really don't think people in the UK realise what's happening. Then you have the moronic "don't let the door hit you on the way out" comments. We NEED workers and businesses in the UK and we NEED to incentivise them to come and stay, or at least not punish them for staying!

It's common sense that we can't have fewer people working than not working - that's the economics of the mad house (or Rachel).

'My son is a graduate actuary working for one of the largest insurers in the UK. Nearly all his cohort plan to leave the UK once they've qualified. Nearly all the leavers do's he goes to are from young workers emigrating.
It's a massive problem and I really don't think people in the UK realise what's happening. Then you have the moronic "don't let the door hit you on the way out" comments. We NEED workers and businesses in the UK and we NEED to incentivise them to come and stay, or at least not punish them for staying!'

This is the thing. A lot of current medical students are apparently making plans to go abroad after qualification too.
The whole tax system needs an overhaul imo. It gives young, hard working, higher earners a big slap in the face on top of the slaps from their large student loans and the huge cost of housing. Why would they feel loyal to the UK under the circumstances?

Of course we do. It’s madness.

Thank you but I want to see data, not secondhand description of an analysis "according to Henley & Partners." I appreciate you don't have access to that.

Of course there is a ceiling for most people, but I’m not sure that policy should think about what amount of tax a handful of wealthy individuals would be ‘happy’ to pay because that’s very subjective.

You call it a politics of envy but it’s equally a policy of greed - ‘it’s mine and I’m taking it with me rather than pay more tax than I’m ‘happy’ with. Taxpayers money bailed out the banks, didn’t see anyone checking if we were ‘happy’ about that. Taxpayers paid for the Iraq invasion, plenty of us expressed our unhappiness with that. It’s a collective, if people don’t like it they’re free to leave but thinking they can hold everyone else to ransom because they’ve got more money is… well it’s not enviable is it, it’s actually pretty pitiful.

The presence of all those non-doms who have no left didn’t produce any measurable impact on the economy that I can see - not real impact now they’ve gone. You might know better but there’s a lot of hot air about how we ‘need’ the ultra-rich but how does it actually benefit our economy or society to have them here but minimally contributing?

@Whatevernext9there is an impact when tax receipts fall. The pp mentioned CGT which is now under. Labour follow a system of ‘headroom’ which means whatever amount they’re out by they have to cut on spending. Hence welfare cuts and subsequent adjustment.

Recent analysis put headroom out by a huge amount, if that hits gov modelling we will see the impact on cuts. Maybe higher taxes too.

I’d rather be in a higher tax/higher trust regime tbh because the impact of ‘money buys you out of the rules’ goes beyond tax receipts. Acquisitive crime, over-consumption and massive personal debt are all tied to the idea that money = status. I’d rather see a wealth creation/entrepreneurship tax break than a return to the non-dom system which just seems unfair and does nothing for social cohesion.

I’d rather see a wealth creation/entrepreneurship tax break

So would I. What an excellent idea.

Ok but you might just end up with more cuts to welfare and other as Labour have shown they need to balance out the loss. It’s unlikely borrowing will go up as debt servicing is very high already and they’re learning tax increases stifle growth.

Which leaves cuts. And then you have Labour back benchers saying this isn’t what we wanted. This kind of loop isn’t too problematic yet, they’re managing but more loss and higher cuts and it’ll get very strained for them.

ETA On a tax break of course. Maybe the next GE we’ll see incentive rather than stifling that.

For the last 15 or so years, we ve seen more millionaires/billionaires in the country than ever before yet we have also seen huge cuts in public services, low to zero gdp growth & the highest tax rates since WW2, other countries with less high wealth people, have done better, despite having higher tax rates.

So what exactly have they given us?

All these threads follow the same pattern..... protect the wealthiest, meanwhile Uni students in Health Engineering Science etc can just pay more and more in loan repayments.. no one cares... despite the simple fact thats its these people who will drive economic growth, not people who hide their money away in tax havens and trusts to avoid taxes they wont even pay... they'll be dead!

@EasternStandard It’s true, that might happen. I don’t think there is an easy solution because there are a lot of factors. But equally I don’t think
ee should resign ourselves to being nice to the vocal minority of multi-millionaires making demands either. I’d like to see more positive solutions and a more constructive debate but our media doesn’t facilitate that and then the politics becomes polarised and toxic.

The key word is insurance. You may not use it but it’s there. If in return for it paying your national insurance will you forego the use of NHS completely? While you’re lying in the road after a car accident, would you like to sort out your private ambulance to take you to your private intensive care bed (they don’t exist).

Alternatively , you can forego youttax and watch deaths from childhood leukaemia spike?

The NHS is not perfect but it’s there for most people when they need it. We could tweek it. When I lived in Australia I paid ambulance insurance (£30 a year). It covered the cost of an ambulance for me up to and including flying doctor or helimed evacuation. You could add it to your household insurance and most people wouldn’t notice.

We could add a £25 charge for a gp visit with children, oap’s and low income exempt-

Small things but they would probably ease the burden on the NHS.