If a wealth tax brought in zero revenue to the government, would people still support it? If yes, why?

[percypiggy200]

I’m curious and I’d love to know people’s reasoning.

Yep the answer is to incentivise. Understand behaviour and encourage job creation. The opposite of Labour’s approach.

I think many people feel frustrated because taxation is considered the golden bullet for poverty and all of its consequences when we know this isn't the case.

Firstly, the idea that giving some households more money will magically change key outcomes because they have technically been 'lifted' out of poverty is so ridiculously naive. The assumption is that the only thing stopping these families engaging in education, eating healthily and going on to build successful careers is because they lack money. We all know from our lived experience this isn't the case.

There are cultural, intergenerational issues at play that are being compounded by a dependency and entitlement culture. All of these things are a far more difficult nut to crack than simply handing people more of someone else's money and pretending that this has solved the problem of inequality. It makes me so angry I could scream because ultimately everyone loses. The poor buggers paying the tax that feeds the dependency model and the recipients who are being led to believe that their only real option is to carry on this cycle of deprivation and entitlement. So many are raised to not even try.

My child goes to a school with a high percentage of FSM children and poor families. Some of these families are in school everyday on time and eager to learn. They do all the homework and I they tell me that they are going home to a nutritious meal and they live in tidy, clean homes.Their families may be poor but the children don't experience poverty in the way many imagine it to be. Other children in the school have the opposite experience of life and live in what many would describe as poverty. They are dirty, fed chocolate for breakfast, have erratic attendance and never do their homework. The difference is not money.

Will it grow the economy?

No. In which case leave it alone.

Until they grow the economy were doomed. We need more people less dependent on the government.

@EasternStandard I am certainly not arrogant enough to think that I alone can fix our productivity problem! Why on earth would you assume I have the answers?

Is it simply because I said higher taxes are inevitable? Are you saying higher taxes aren’t inevitable or shouldn’t be?

Two things can be true, higher taxes to stand still are inevitable, this doesn’t mean we will see any growth. Is this really a controversial thing to say? I’m so confused 😆

Can wealth as opposed to wealthy just leave the uk as easily. I understand the distinction between wealth and wealthy but I dont really understand isas. Can I just buy a product in a different country instead. If I was going yo own two homes in the uk, and inheritance tax was better in wherever, so i bought a second home there instead, do I pay tax on the second home there or here?

I think if we brought in a wealth tax, income tax should be adjusted in some way so the highest tax bracket pays less . So still net positive to the government but people get to keep more of what they earn, and less of what they are given by generational wealth.

I wouldn’t support any tax that had no benefit to the country - the whole point of tax is to raise income so if that isn’t happening for whatever reason then that tax should be scrapped. Whatever it is.

I’ll go for an answer, which is in pp anyway, incentivise job creation.

Understand behaviour and work on getting people to do more, not less.

The 11,000 figure is from January 2025. VAT on school fees only commenced on 1 January 2025 so the data you are referring to is out of date and didn’t even cover any period where VAT was actually payable. The most recent survey shows that 25,000 pupils have left. That was after two terms of VAT. Many parents are doing everything they can to get to their kids to a natural transmission point so there will be more.

Exactly.
This isn't sustainable and the only way you get people into work is by a thriving economy. Labour seem intent on strangling economc growth so they therefore are growing the benefits bill and placing more and more pressure on taxpayers.

Surely, the answer 'is' money where the parents can't or haven't made those structural decisions that would enable a child to succeed? Society needs provisions for these children, provisions that were whittled away under 14 years of austerity and partying over kids with malnutrition!

I mean if I was in charge I would pause the triple lock & put all that money into investment. Scrap NI & roll into income tax, sort out the cliff edges. I would overhaul property taxes and reduce stamp duty so you pay less upfront. IHT would have a much lower threshold but a lower % tax to pay. I would want to raise the income tax band so would need to raise money from other sources. Build a shed load more housing.

Would this fix years of low growth? No idea, it will certainly takes years to change things. And it will cost, a lot! And no one would vote me into power because people don’t want to pay more 😁

Yes there is certainly the mis use of money.

Some people will never budget according to their income.

However, some families have no chance, parents who do not have cooking utensils, MH issues that are left untreated,
A project in Liverpool, highlighted on R4, showed some women had zero nutritional knowledge & no cooking skills, so they bought them cook books, only to find many couldn' read.

My DD did XC running at school, a seemingly cheaper sport but it really isn't, its packed full of MC parents, spikes cost a fortune, getting to training sessions and racing events, they'll never be kids from poor families there.

Lifting the 2 kids policy wont change any of this, it could be far better targeted.

When people post about the number of people dependent on the state such as @twistyizzy image do the realise this is also a consequence of the working age population increasing because the age of the state pension has gone up?

@Katypp no I don’t mind paying inheritance tax. I would far rather my parents were actively encouraged to spend their money. And yes I am likely to inherit and frankly if that £1m becomes £500k it will still be life changing so I won’t begrudge the £500k in tax being paid.

@EasternStandard but you didn’t answer my question about where we are now and higher taxes. Taxes are high at the moment, that is a fact, why do you think this governments will decrease them or the governments after?

Are you assuming because I said tax increases are inevitable, I am pro raising taxes? Again two separate things….

How exactly does giving these families money help the children? How will it positively impact outcomes?

The families are already making objectively terrible choices with the resources they do have. They don't devote their energy and time to getting their children to school or to do their homework. They don't spend their money or time on nutritious food. They don't even wash their children's clothes or make sure their kids are clean. Giving them more money won't change any of this. Inequality runs through our society like a stick of rock and it really isn't even mostly about money.

I would be supportive of direct intervention for these families but it would be a very tough nut to crack and would rely on parents feeling the 'pain' of their crap decisions. We need a way of doing this whilst protecting the children which is almost impossible to do.

So what does this look like & why did the previous government not manage it?

I agree completely.

Poverty isn't even mostly about about money. It's about having illiterate parents who don't know the basics regarding parenting and nutrition. It's an intergenerational cycle of dependency where nobody has a job or purpose. There is a lack of aspiration and belief that things can or should change. It's about a total disregard for education and for society in general.

Money can be used to tackle some of this but it absolutely isn't through handouts to poor families and assuming that this eradicates poverty and inequality. Only someone that hasn't experienced poverty or been around it would think that would work

It looks like the opposite to Labour’s approach for a start. Understand what the barriers are to risk taking and encourage more of it. Usually in the form of tax changes and fiscal incentives, maybe other stuff. First agree it’s worth doing and then consider detail.

We rely on SMEs, no need to hamper their creation and growth.

Maybe someone will propose it at the next GE.

Well firstly by not introducing taxes which change behaviour eg employer NI increase. Labour keep on refusing to accept that specific taxes will impact behaviour and are then "surprised" when they do (see rising unemployment figures, closure of small businesses as a direct result of NI increase plus Education Tax).
Usually taxation is used to influence behaviour eg raising tax on cigarettes, giving tax free ISAs. It is an accepted method. Labour refuse to acknowledge it, plough ahead with taxes which impact behaviour and then seem shocked at the outcome.
That's why they had to u-turn/soften on nom dom taxes. It's why they should have never increased employer NI etc.

Without a booming economy, it all goes to shit as we’re seeing now, and as we will continue to see with this nasty Labour government.

I do find some of the narrative on here odd. Is the labour government more nasty than the last Tory one? I’m annoyed at them for fiscal drag tbh. When did we last have a booming economy? we never recovered from the 08 crash but low interest rates masked a lot of that. I agree it’s shit now but it was shit before!

@twistyizzy so how did the previous government demonstrate they understood tax increases change behaviour?

It’s maddening. Building lots of housing would transfer wealth away from the rich but it a constructive, pro-growth way.

But the govt only seems to be able to look at problems from a “who can we tax for this” lens instead of “what actually needs to change to get growth going”. So disappointing after Starmer set out by saying growth was his top priority.

I’d argue that school fees VAT was the same. I’m not massively opposed, but that’s really not what needs to change to improve education.

Exactly. To be fair they did give it a go. They reduced the higher rate tax from 50% to 45% and saw tax receipts increase. The private sector was starting to thrive again under Sunak. We now have job losses, hiring freezes and companies collapsing as a direct result of the last budget. Anyone who doesn’t know this is living in a public sector/welfare bubble.

@EasternStandard so you haven’t actually told me anything and in the meantime what would you do with taxes?