Not an ordinary working person if you earn over 45k

[TesChique]

Disincentivising anyone to strive to earn over 45k a year is a bizarre strategy for growth i feel

Aibu?

I could be wrong, but I think a few points are worth mentioning on this thread:

1. As far as I can see, the tax is not meant to punish people who Labour have decided count as “wealthy”. It is a tax on a group of people who create a large enough tax base for the revenues to make a difference AND who they think are not destitute. All those saying that 45k isn’t rich are not wrong, but they are missing the point a bit. Labour isn’t claiming they are rich.

2. so why not just tax the rich? Labour said they would do that, but I am pretty sure that was just rhetorical. Easy vote winning rhetoric. The notion that Labour could simply increase taxes on the very wealthy and raise enough funds to pay off the debt interest and maintain public services is not realistic. It is too small a group of people to do a lot of good, and it’s a highly mobile and well advised group of people. Labour needs tax revenue, and they need realistic scenarios to collect them.

3. the revenue raised from this tax increase is not even going to improve public services. In fact, it probably won’t even go near public services. It’s probably just paying off debt interest. It’s not even robbing Peter to pay Paul. It’s taxing as many people as possible to spread the pain around while… feeding a black hole.

it doesn't surprise me.

There have a been a few threads on MN where the amount people are claiming has caused a bit a friction.

There was an AMA earlier this year where the OP was earning the equivalent of 80k before tax. She didn't work because she was a single parent carer to 3 disabled children and if I remember rightly she didn't receive any financial support from the father(s). The thread didn't go well and she ended up deleting it. Her view was that she was saving the tax payers money by not putting them into a residential setting. I guess that is one perspective...

A couple of months ago there was a thread asking for advice about how a couple both working reduced hours in the charity sector could make their money go further without if affecting their soft play or birthday present money. They worked reduced hours in a low paid sector through choice because they felt it was important for them to both be around for their children whilst their children were young. Top up benefits made this possible and they felt entitled to those benefits.

The gvt seem to do everything they can to attract people to claim benefits instead of working. Why is this?

And then of course we see anyone earning over 45k, not a working person, but that doesn’t stop them paying the taxes which pay for others to leech of the state. Excellent.

And Labour want to remove the two child benefit cap, which will make the situation worse by encouraging people to breed for a living.

Why would they even consider doing this. Just beggars belief.

There are the crowd on MN who are like "oh but circumstances change"

Certainly I’d expect the ‘backfill’ mentality to resurface.

There are few places left in the UK where earning £45K is “a lot”.

They need to retain the cap, get rid of the universal free school meals, abolish the triple lock, get rid of winter fuel allowance and actually do something about PIP and various other disability benefits and that's before they even think about raising more revenue

Yes, and that includes all the hard working people - the majority of workers in fact - who don’t earn high salaries.

Earning over £100k with kids in nursery is not wealthy either, it's a good salary but wealth is what can be saved and that's different. Many relatively ordinary older people have homes that would be unaffordable in that salary

The effective tax rate is eyewatering.

Assume you’re being sarcastic? Some pensioners need the wfa. I agree stop it for those who don’t. You can’t get rid of free school meals. Some kids just wouldn’t eat a lunch if you did. Yep agree look at PIP very closely. Eg. ADHD mild does not need to be included. Expensive cars like BMWs and SUVs do not need to be funded by the tax payer.

Tax benefits at 25%. Increase income tax for all by 1p.

It is actually wealthy. It's just you have made expensive lifestyle choices, same as people who live in expensive areas and then say that they are not wealthy because of the massive mortgage they have chosen to take out. I don't think you should be taxed more but you are not somehow less wealthy because you have things to spend your money on.

Not remotely sarcastic hence I said universal free school meals, i should have said means test the WFA!

Why on earth should people who can easily pay receive free school meals for their kids?

80% of our GDP comes from services. Including by not limited to finance, consulting, law and tech. Driven by high wage high productivity sectors.

I'd thank a high wage worker.

Do you think everyone working in services earns a high wage? You are mistaken if so.

The biggest problem we have is that GDP comes from services and not from goods or manufacturing. That leaves us with a fragile economy, and limited options to grow it.

R.e. Free school meals why can't parents afford a basic packed lunch? Costing at most £1.80 a day per child?

Wouldn't most parents go hungry rather and let their kids go hungry.

Not everyone does. But I'd thank the high wage workers first for the value add they deliver.

What's wrong that we're focused on services? We are good at it. We are world leading. London is second in the world (only beaten by NYC) for a financial capital.

Sadly not all parents give a shit. And their kids are the ones who need it most.

It’s pretty obvious what’s wrong with a service based economy, we’re living in the reality of it and will be for at least a generation yet. NYC is a city in a nation with a far more robust mixed economy.

Means testing is expensive, the system for recouping WFA for those above the threshold is more efficient (regardless of whether you agree with the threshold).

No it's not. What's wrong with it?

I mean yes there will be tradeoffs for everything and maybe things can be looked at and changed.

I think our service industry does us proud.

Really, you can’t see the obvious risks in that? I find that quite surprising. It’s not about whether the service industries are any good, it’s about the basic risk of reliance on intangibles.