AIBU Income Tax rise.

[H202too]

To be panicking about income tax rise.

Things are tight and to loae even £30-60 a month will be difficult.

I know people are talking about the mansion tax being a no go. But I would prefer this than taxing the workers as per usual.
The tax free rate should be put up. What a mess.

I want better public services and am happy to pay more tax.

not someone in 18k annually for working 100h. I earn substantially less than a full time worker on NMW. I did not choose part time employment. the state forced me into it by refusing any sort of social care support for my adult child without providing any compensation for the extensive work I have been forced in. In the end, there is nothing I can do. we cut so many things, we will just cut more. we are used to not having much.

you don't have to live in London.

I don’t dispute that. I’m making the point that there comes a point where you keep hammering the middle earners then they just stop being as productive and then less funds to provide you with assistance.

the only solution of the government is to reduce their spending and they don’t want to do that. I just don’t understand why the government don’t understand how people behave in the real world. They will always act in their own self interest

It’s already been leaked that the Government classify “working people” as anyone earning less than £46k, so we know exactly who they plan on hitting.

It’s a perverse number to pick given HMRC define a wealthy individual as someone with an income of more than £200k, or assets over £2million.

https://news.sky.com/story/income-tax-and-national-insurance-unlikely-to-rise-as-sky-news-obtains-definition-of-working-people-13459288?sv1=affiliate&sv_campaign_id=103504&awc=11005_1761833796_1387ade82ec979e49fbf1ed168620189&dcmp=afc-103504-na-na-longtail&gad_source=7&gad_campaignid=16293893699&dclid=CKKC0qyOzJADFZsrYwEdrlIY2g

You can voluntarily pay more tax - there is a form you can fill in and you can tell HmRC to take as much as you want.

funnily enough, despite many people saying they are happy to pay more tax, most people don’t take up this option.

I’m London born and bred and my family are here. Why are we trying to make London a no go zone?

well, middle earners can afford more tax without having to go without food/heating etc. Very low earners, the disabled and unpaid carers can't. It's a political choice to punish the very poorest but Labour has lost its way so it's probably coming.

Agreed! Most of her tinkering so far has actually reduced the tax take (capital gains in particular), and so many other unwanted side affects from her policies.

I am so fed up of all these wealthy people who claim they are subsidising people who don't work and are not 'net contributors' (vile phrase). I earn just below £70k and as a single adult household pay more tax on that than a couple earning similarly will do, which is unfair. I think you should get allowances for being the only adult in a family, not a pat on the back and a handout for being married - wtf is that about!?

I had to pay back most of my child benefit last year (less this year though - yay!) which really stung. I also have a second job (exam marking) and am questioning whether to give it up as it resulted in my not paying enough tax (separate from CB thing) and having my code changed to pay more back. It seems it's barely minimum wage when you take all that into account and I do think it's very unfair that you get no personal allowance for a second job. I am nowhere near being on £125k including the second job and it seems so unfair that I get taxed to the hilt on it. It seems you reach a certain point where the more you try and do to improve your situation the more is taken off you and you are pushed back down a bit. Related to that, I think the tax thresholds being frozen is grossly unfair and needs to be addressed. I'm doing way more effectively for less than someone in my current role would have been doing 5-10 years ago and it's just not fair.

But my salary looks decent enough on paper and I feel I do ok. Nowhere near being able to go off to Dubai in a strop (not that I would set foot in the place for love nor money) or being able to go down to three days a week or whatever.

I'm doubtless not a net contributor but I hardly feel I've been a drain on society and I'm sick of that shitty attitude from those who seem to feel superior to others when a lot of their wealth is probably down to a mixture of family background,luck, marriage and perhaps not feeling a need to do a job with any moral value to it (bit of a sweeping generalisation, but no more so than saying everyone else is a waste of space, which seems to be the message).

Labour shouldn't have said they wouldn't put taxes up but they wouldn't have got in if they hadn't said it, despite what those on the left are saying now, and we needed them in. If we all have to pay a bit more sobeit, but obviously if you have more you'll have to pay more, so stop whinging and pretending that the reason it's all so shit now is because of Labour when we all know Brexit, Covid and austerity are what have ground this country into the ground over the last 15 years. Despite all that, taxes got to a 70 year high under the Tories while public services were destroyed, lets not forget that.

You are « absolutely not happy to pay anything extra » … well, nobody wants to pay anything extra so what do we do?
You say you earn just above MW and work part time, so you barely pay any tax as it is and you must take quite a good amount from « the pot » : schools for your two DC, any UC?, NHS and social care as you mention special needs, Child Benefit… council housing? that would mean your rent is subsidised.

So to sum up, you already contribute less than you take but want others to pay even more than they already do? Right.

I'm a Scottish tax payer, had 2 pay rises in the past 5 years and seen my team double and my responsibilites treble.

Wage in my hand? Less than my 2019 pay packet.

Also, now I have to pay for private detal care (£480 per year pp), mostly paid private healthcare due to lack of NHS services where I live and £££ on private prescriptions as nobody in the NHS seems to have been bloody well trained in the menopause.

Next GP appointment? 19th December.
Local trains? Nope.
Bus services? Mostly cancelled.
Library? Hours reduced.
Pot holes? Plenty.
Crime? Loads.
Multiple road projects to link Scottish cities and take down travel time? Never properly funded and now pretty much abandoned.
Support in schools to help the over crowded classes with far too many SEN kids who are struggling? Gone.
Affordable housing? You're having a laugh.

I keep being reminded I am one of the lucky ones but I could go on.

So yeah, take even more tax off me but I am already doing the best I can to avoid public service costs. I prioritise health and education for my family but this is at the cost of spending in local shops and small businesses as its just not there to spend any more.

But to those saying 'very high taxes on very high earners wouldn't make a difference' - I don't understand?

Let's say you're a corporate lawyer or banker earning 2 million a year. Your earnings over a million are taxed at 80 percent - 800k for this tax. Let's say 10,000 people in the UK pay that - that's 8 BILLION to the government (and given the number of people earning over a million is double that, it's a conservative estimate).

Your remaining million pounds of income is taxed at current rates. Net, you are still taking home over half a million a year. That's PLENTY to live on.

@thatsmyhouse I don’t get your point about income tax for a single person vs a couple.
If you earn x you will pay the same amount of tax regardless of your marital situation.
Or are you comparing someone earning x to two people each earning half of x? In which case they would each pay the same as a single earning half of x.
No upside of being married for tax purposes, only downsides: if your spouse earns more than a certain amount you can’t claim some benefits that you could have received if single.

The David Cameron Cayman Islands thing just illustrated the lack of understanding of offshore investments. People are allowed to invest overseas. The Cayman Islands have a lot of non-tax related advantages which make them appealing for investors. Regulation is low for instance. Low compliance costs. Investors are obliged to declare the income on their tax returns and pay any due tax which David Cameron did. No story.

And the take that film scheme. Ask them in retrospect if they’d do it again. No way! Shows the change in attitude to getting involved in these schemes.

Since when did looking after your family become providing social care support on behalf of the government?

I'm getting really rather tired with hearing this repeated bleat about '14 years of the Tories' and the 'decimation' caused by austerity. Austerity that was needed to cover the flagrant overspending of the Blair government I might add. Are you forgetting the £70 billion that furlough cost the country during Covid? Zero of which many of we so-called higher earning professionals saw because we were the ones working 14+ hour days to ensure essential services were maintained and the wheels of education, law, social services and local authority mandates kept turning.
'The problem with socialism is that you eventually run out of other people's money' is hitting home after only 15 months of this Labour 'shitshow'.

Over 70% of income tax is paid by people who pay higher and additional rate income tax (which accounts for about 15% of income tax payers). Low and middle earners in this country pay very little tax vs other European countries. The word ‘fair’ makes no sense in this context. There is no absolute definition of fairness when taking about a progressive tax regime.

No but a couple who combined earned the same as me would have two lots of personal allowances, whether married or not to be fair. I just think if you an adult solely responsible for supporting children there should be a tax code to reflect that. It would help to make up for the fact that they never want to make absent fathers pay - separate issue, but still.

These rises will be mainly used to try to pay down debt not improve anything. There will be no money to improve things they will just shuffle it around to make people think there will be improvements, and all in x years time of course (if you vote us in again).

There is also the ability for a high earning husband/wife to pass some of their income to their spouse for tax purposes to make best use of tax thresholds.

And then you think it would be ok to come back to the UK after a stint in the desert and benefit from all our public services, when you hadn’t been contributing?

Very high earners lose personal allowance, pay NI, 45% tax, lose funded childcare. A person without childcare hits a marginal rate of 62% between 100k and 125k. This increases to over 100% if you have childcare and you’ll be worse off between 100k-150k ish. Someone on 150k pays 15x more tax than someone on 30k despite earning 5x more. How much of other people’s money do you want?

You can’t keep taking from such a small base. It’s already at the stage these issues are losing the treasury money. Many of their studies have told them this. They won’t fix it though because of this kind of disillusion that higher earners are not doing enough despite subsidising the whole country.

Awkwardly, it’s the middle and lower earners and jobless not paying their fair share.

you are assuming an 80% tax rate wouldn’t prompt people to change their behaviour, which is highly contested. My chat gpt query suggests it’s more like 5,000 who earn over 2m btw but it’s not explicitly available data.

if you are a corporate lawyer with the ability to earn 2m you have lots of options for where to live and many would choose to live elsewhere. That would make it very difficult for companies to recruit talent. It’s not simple to increase taxes on the very wealthy, there aren’t many of them and they are highly mobile.

Who would work for 20% of their salary. The entitlement is off the scale. Behaviour change. Look up the Laffer Curve. In fact, look at recent history and how tax take INCREASED when the higher rate dropped to 45% These people will just work 20% of their time or go abroad.