To think the UK unfairly taxes families?

[OwnGravityField]

I have just found out that the UK is an outlier, in that it completely stops collecting a form of social tax (NI in the UK) once someone gets to pension age.

In every other country, pensioners’ contributtion as a proportion of income is much more similar to working households.

Example of disparity in the UK:

A working person earning 25k pays:

• Income tax: £2,486
• NI: £1,002
• total = £3488

A pensioner with an income of 25k pays only:

• Income tax: £2,486
• no NI
• total = £2486

So, a UK worker on 25k pays 40% MORE total tax than the pensioner (the difference between 2486 and 3488).

Let’s compare with a beloved utopia of fairness, such as Sweden: worker on similar salary pays 9% more tax than a pensioner.

Yes, other countries have slightly larger differences, but none except France come anywhere close to the UK difference in tax treatment between workers and pensioners.

In the interests of balanced sharing of info: France is tax and spend basket case. France taxes workers roughly twice as hard as pensioners. It’s obscene and the country is practically bankrupt.

Most other European countries narrow the gap by keeping small health or social contributions on pension income.

You might be thinking most UK pensioners don’t have 25k coming in? Nope. 3 million have individual incomes of 25k or more.

Anyway, I think it’s shocking that people at the most expensive time of their lives (kids, mortgage, food) are taxed so much more heavily. AIBU?

This thread is about pensioners paying less tax than everyone else so it doesn't apply to the situation you have described. Why do you think you are in a 'despised group'?

That was my point. The whole concept of ‘I’m finished paying tax’ followed by a dramatic dusting off of one’s hands doesn’t exist on the continent.

@MrsBennetsPoorNervesAreBack was proposing combing the two into income tax. You are simply describing the current system rather than providing an argument against what she said.

But pensioners who get £25k have ALREADY paid the tax on this income?

Only if you don't care about your family or where you live and are essentially a digital nomad.

People shouldn't have to uproot because their government can't manage it's finances.

I can't think of any logical reason why it should exist at all.
There is no special, personal NI account which an individual draws from. It's simply a form of tax so everyone should pay it. Today's pensioners are taking out far more than they put in, on average. I think the average drawings are double, adjusted for interest.

Personal/social care is means tested. But this thread isn’t about that. It’s about the unfavourable tax treatment of workers.

I'm saying that many people will expect a pension and free NHS care despite having contributed very little for decades.

Of course the NHS must always be available to anyone at the point of need, but this constant expectation that someone can not work for years or do 16 hours a week and expect to receive the same level of retirement income, is starting to wear a bit thin.

My point was to illustrate that the concept of ‘I’ve already paid my taxes’ doesn’t occur on the continent.

Sure but that's a separate point and not the topic of this thread.

But other unfair government spending by is relavent. I think the group that B is enjoying huge amounts of money spent on childcare and child benefit really don’t have much call to moan about taxes when they’ve yet to spend half of what pensioners have paid.

I think you’ll find many “pensioners” (by which I assume you mean over 67) are also workers.

Of are we using Labour’s alternative definition of workers already?

My parents paid all their working life yet never benefited from things we get now - maternity/paternity leave for example. Mn really hates old people at the moment. The fact that many will need a a care home and if it tax them, they’ll just not be able to afford it so it’ll be down to the council, so it’s a false economy anyway.

Obviously, they would have to raise income tax, as I acknowledged in my original post. I would have no issue with them doing this, and I'm not suggesting that we should just get rid of it without replacing it. I just don't understand the point of keeping it as a separate tax.

I also don't really understand what you mean by saying that NI is "mainly used for" NHS, state pensions and some benefits". As far as I understand, NI income is not ringfenced in any way, so there is no actual difference between this and any other form of taxation. So there isn't really any reason why we still need NI as a separate tax. Surely it would be more efficient to just collect it in one?

I understand the principle that pensioners are exempt because they have paid the required contributions, but I'm not sure that I really agree with it. Some pensioners have very high incomes, and I'm not sure why they need to pay less tax than the rest of us. Plus we already top up the incomes of many pensioners who haven't paid enough contributions so I'm not even sure that a contributions based system is particularly meaningful.

I agree, but an argument about mismanaged revenue isn't the same as stating a general desire to pay minimal tax, that’s all.

Proportion of people getting uc or childcare is a mere tiny fraction of the 33+ million workers.

Also, something like 40% of graduates are childless.

But again, this isn’t a thread of comparing benefits. It’s comparing tax treatment.

I don’t think it is fair to compare us to Sweden we have a much larger population and pretty much everyone in Sweden pays 40% tax. They put much more into the system than we do

Not all could, my Dad came home from work, Mum went to work. At 8, a latch key kid. Please don't make generalisations, as that feeds anger and no, they never earned enough to buy a home either, as mortgages not given to all, but always worked and put their children first.

In which case I'm not the best person to talk to about taxes. Taxes are theft and only possible because of the implicit threat of violence by the state.

I think pensioners in receipt of earned income should pay NI. For clarity I'm a pensioner who's still working part time.

You forget that many women were able to be SAHM and stop work entirely for many years to raised their children. Those who did work often worked very part time, in less demanding jobs. This is obviously far less common now as two salaries are usually needed to pay for basic necessities such as housing, which is twice as expensive relative to salaries now.
Perhaps you haven't noticed the dramatic fall in fertility rate. People have stopped having children because of the costs, at least in part. Do you think this is a good situation overall or do you think the state should be encouraging young people to have children, who then grow up to pay taxes and support the older generations?
I don't know what you are referring to in the last section. What have pensioners paid?

I think maybe if people stopped frittering and spending money on endless tech, frequent expensive holidays, take aways, coffees, nails, new cars etc ( all things older generations managed to do without)they may find children far more affordable.

Pensioners can move to Thailand if they wish and they do not want to pay their dues.

This is such a foolish post on so many levels by someone who doesn't understand basic maths and is just showing their personal prejudices and resentment.

By the way, I agree with you that people are absolutely hooked on consumerism. However, this applies equally across all age groups and is certainly not particular to the young and is a separate issue.