AIBU to think a 2% wealth tax on the rich is unfair?

[Mrspepperpotpot]

i just saw an article and petition from oxfam saying if we taxed the ‘super rich’ 2% it would solve a lot of problems. They were suggesting 2% on anyone worth 10 million. Everyone in the comments agreed

I just don’t understand this mentality. High earners are hit at every turn. They usually use private health and private schools, pay the most tax, get hit with tax on savings, IHT, land tax, pensions etc etc Why on earth should people earn money to be taxed on it, to then be taxed on it again and again.

Why do people begrudge others having money when they’ve worked extremely hard to get it? Why isn’t there uproar about benefits instead?

I know this will never actually happen but the amount of people who seem to want it to is astonishing

Many of the things you have listed are optional.

2% of 10 million is 200K. Easily affordable if you’re worth 10 million.

It’s a joke as the issue is too many on welfare, and the majority now use it as a life choice. Taxing the rich won’t help as they will go elsewhere and the middle have been squeezed so much. When people on benefits are earning far more than those working, something has gone wrong.

High earners work no harder or longer than low earners. They aren’t even necessarily better qualified. Earning lots of money is mainly about luck, followed by timing and sometimes choices (which lots of people living in poverty don’t have the luxury of).

I have a degree from Oxford and an MSc but am an average-ish earner (teacher with some extra responsibility). Even I wouldn’t mind paying some extra tax, as long as the millions who are richer than me cough up.

even if they could afford it why is it fair? I would also argue some could not afford it depending on where wealth js distributed

Goady thread. Nothing better to do this morning?

I think that a tax of 0.25% ofer 10 million is more likely

Whether a 2% tax is fair or not will depend on what is taxed.

A 2% tax on an independent pub chain asset-based business would put it into immediate liquidation. A 2% tax on a liquid stock market portfolio could easily be funded out of income or growth.

What proposal are you reading? The Zucman proposal is a tax floor of 2% that’s only applicable to those with 100 million Euro of assets. Any tax they already pay is taken off, it’s to ensure the super rich pay the same percentage as the rest of us. Needed because they have so much wealth in assets that don’t get taxed at all or at much lower rates than work. I think it’s a great idea.

Much more likely to be 1% or just under, I agree.

This simply isn’t true, loads of high earners work extremely long hours with mad responsibility that isn’t true for other staff. As it should be.

Taxing the super wealthy too much is dangerous - they could well move overseas and they are the ones most likely to create jobs and invest in the uk , rather than take from the system.
I can’t understand why they don’t try and support uk businesses to create jobs so benefits then would be needed less, and then they would get tax from successful businesses anyway. They are doing the opposite and causing many businesses to have to close. Is it really that difficult?

We have a lot of wealthy friends - many are in that bracket, and we were at a dinner party last night so this was discussed!

The bottom line is all of those people have enough money to have options.

If higher taxes are introduced in the UK they’ll look around at the world, wonder whether the UK really is the best option for them, and then they have enough money, contacts, knowledge etc to just decide to go live somewhere else.

Obviously if the wealthiest people leave then the UK loses the tax they currently pay, as well as all of their spending, so there’s a balancing act to raise taxes just enough that you raise more income without actually pushing people to leave.

The problem is, you don't want all the super-rich to leave either. It's a fine balancing act...

So do many low/middle earners. High earners don’t work harder.

How is it fair that someone can make 10 million while someone else makes else makes 0.2% of that? They don't work 99.8% harder than the lower earner. Wealth inequality is unfair and mostly down to luck, not hard work or skill. Plus, a 2% tax would have very little impact on them.

It varies a lot - thinking about my super wealthy friends some came from rich families and are just lucky, but most came from average families but chose very high paying professions and to spend all of their free time and money investing or setting up new businesses.

I agree with you op. Where is the incentive to improve your life if it's just going to be taken from you?
Benefits definitely need looking at and also foreign aid. It's beyond me why we are sending aid to Pakistan a country which has a space and a nuclear programme.
I would reinstate the 2 child benefit cap, there are many families who would like more children but they don't because they can't afford to.

Taxes have always been, and should always be proportionate to income. Percentage wise, the total is small change if you are earning £10m. The expenses you describe are either optional, or unlikely to result in a material shift towards investment in public services.

Equally, we do need to shift people at the lower end of the income scale back into work, and make sure work pays what it is worth. The fact carers are paid so poorly is criminal, and the fact my hairdresser has chosen to stay unemployed because it pays more now that she has had children, than working with associated childcare costs seems barmy to me. She loves her job, but just can't make it pay.

Finally, when looking at welfare and benefits bills, check the headline figures... they often include the state pension, which over inflates the actual number. I doubt many people believe a cut to the SP is a good move, but it is expensive.

The issue is people always focus on one end of the pay brackets or the other, rarely look at the whole.

They don’t work proportionally harder to get all their money! Many people on more standard incomes work extremely hard!

Exactly. They rarely 'switch off' from work. Even when they're not in the office.

Yes, just cut a few jobs in your business each year and you will have it covered in no time…

That rather depends on what your £10 million is made up of. If most of it is assets, you might not have the cash to pay £200,000. Take farmers as a case in point - their farmhouse, outbuildings, stock, land and machinery might well be worth in excess of £10 million, but they might be relatively poor in terms of cash. It’s far too blunt a weapon - those who have £10 million that is readily realisable will simply leave the country, and we will all be the poorer for it. Just look at how much income tax is paid by the top 1% - if we lose them, there won’t be any money left for all the things the government chooses and has to pay for. Be careful what you wish for.

The don’t work harder and most people with extreme wealth didn’t earn most of it - they had advantages like inheritance

you get a happier, less violent society if the gaps between rich and poor is less

money isn’t making the super rich happy either

why would someone with millions begrudge giving a bit more so that children can have their own bed or a family get support to care for violent children ? I don’t think most of the super rich are inhumane

A 2% tax is simply unworkable. As above the high earners already more than carry their weight. The top 10% of earners pay 60% of all income tax revenues, and also cost the state far less in healthcare, private school fees and other costs. They are also mobile and actively wanted by other countries. Many, many have already left and lots more are making moves to go. They are being actively solicited by other lower tax jurisdictions who are enjoying strong growth and doing well. Middle income earners don’t deserve to be hit with loads more taxes (which is the inevitable result) - the only short term answer is cutting costs.

We also need to get growth going again - if they cut cgt to 5%, reduced the max rate of income tax to 25% over £250k, cut all the other “rinse the rich” tax grabs like land tax, and said entrepreneurs can get cheaper funding etc (guaranteed for 10 years) the UK could start ATTRACTING high earners rather than pushing them out the door and saying “we don’t care, good riddance”. They would employ people, develop companies to invest in, and enable more money to be kept in the UK from our massive talent pool.