to think 51% tax is ridiculous, and already to be planning to move to Asia

[hedgiemum]

Namechanged. Married to someone who earns well in excess of £150,000 a year, though neither does he earn 7 figures.
He is still quite young in his career - a recent promotion to a senior position, but has not been earning this kind of money of long, so we still have a mortgage and haven't saved large amounts (what we have saved is through his pension which is no longer going to be particularly worth doing.)

He phoned me a minute after end of budget to say he'd watched it with his boss whose reaction was that he would move the company (not a bank, but in finance) to Asia. Probably Hong Kong - 12% tax rather than the 51% we'd be paying here.

Seems like a kneejerk reaction, and clearly we can afford to pay more, but boss doesn't feel he'll get good productivity from staff if they are getting to take home less than half their income. Plus it decreases ever-present risk of them being headhunted by companies in lower-tax economies.

AIBU to be PLEASED (I used to hate tax exiles.) Partly because it just does not seem fair. Partly because this country has been run so badly by New Labour of whom we had such high expectations, and the medical care we have received has been shite, the local schools are shite, the roads are insanely busy and yet is costs so much to live here.

at Sorrento

beanieb - its not about DH's company worrying he won't be able to afford it. Its about them worrying that the other companies in the sector who are tax exiles/have relocated already having an advantage over them in getting/retaining the staff that they want. We do budget, but for our retirement, school fees, and family emergencies; I know that I'm very lucky in not having to budget our food shop, though I did until recently when DH earnt a lot less. (He had 4 years out of finance working in biosciences as it "uses the same maths" (?) as he fancied a different kind of challenge. We lived on a very normal income.)

There are so many interesting things being said, (both for and against this )sorry can't respond to them all; doing this from mobile all afternoon whilst waiting outside school/clubs etc... (Weds is our activity day, other days they just play at home after school before anyone decides I spend too much on after school activities

People who can afford a nice home, holidays abroad, private education and private medicine for themselves have no moral right to whinge about paying a bit more tax. It's bollocks. What do you need all that money for? So you can spend it on stupid luxury goods like ugly handbags?

Seriously - it makes me want to scream.

My son is in a class of 32 at school (yes - I thought it was illegal too....). There are only 4 secondary schools around here that my children stand a chance of getting into. Not one of them has a GCSE rate of over 30%.

The government needs to raise money and people with over £150K a year can afford to give more to the public purse. Let them pay. It won't harm them in any way at all.

"If all of the 1% of the population who earn over £150,000 a year left to go and live in some tax haven, would it reall be a big deal?" Yes, a much bigger deal than the amount of money this tax change will bring in.

As for the statement that higher rate taxpayers dodge the system, this really is a myth, as most higher rate taxpayers are employed by companies and are on PAYE and pay tax in the same way as anyone else. It's generally only once you're earning millions that you can start avoiding tax, or running your own business, and tbh most people I know running their own businesses don't pay as much income tax as they should because of the various loopholes, and yet most of them are not high earners. Yet I don't hear anyone crying for loopholes for the self-employed to be closed so they pay their fair share?

I know someone who openly admits he only pays 10% tax, and he doesn't earn anywhere near the higher band. Or is that ok because he's not a high earner?

Maybe if the government clamped down on businesses and closed the loopholes that enable anyone who is self employed to avoid taxation, they would generate more revenue than just taxing the high earners to make a statement.

"By Riven on Wed 22-Apr-09 16:50:36
I think the wealthy forget we are a society and all inter-linked. You'd not get far with your wealth of the rest of society didn't function!"

So true - and it would be an awful shame to have to trip over consumptive orphans living in cardboard boxes on one's way to the Opera. It might scratch ones Blahniks

Can I ask why you think I have a chip?

Can I just add, in quite strident tones, THAT NOT EVERYONE PAYING HIGH RATE TAX HAS A PROBLEM WITH THAT !!!!
And some of us value society and are happy to contribute.

Thank you.

Good for you pag!

i don't have any problem with people earning lots of wonga. I just find it a bit off when they complain about paying tax.

don't worry pagwatch - my dad is a higher rate tax paying communist.

His views are roughly in line with PW's tax-blogger man.

And I am a champagne socialist too.

I would really like to know the answer to this Q:

OP - Would such a tax increase impinge on your life?

It it only an extra 10% on any amounts over £150K.

as I said earlier, in principle I do not mind at all paying high taxes.

But it is then a bit rich to have to fight tooth and nail for every little thing dd1 needs (and usually fail to get them)

and it is a bit crap to have 2 childrenwith obvious health issues which are not being dealt with.

Luckily, as well as paying our taxes, we can also pay for the services which my children should eb getting already, but i does get a little annoying...

it's also worth bearing in mind that the more tax you pay, the less you are entitled to...

So silverfrog, imagine being in the same situation but not having the resources and intelligence to find the services you need.
I am hardly a bleeding heart liberal but this is one policy that has been long, long over due.

I know what you mean silverfrog - having self funded things for DD that should have been paid for - but services will get a hell of a lot worse in these times unless taxes can be increased.

tbh I'm not sure whether the op was really about her dh's personal earnings, but more about whether this increase will have an impact and cause companies to move out of the UK, which indeed would have massive repercussions.

I think that's a valid argument tbh. If companies start to feel that they cannot attract the best candidates because they have moved abroad then what is to stop a company moving?

My dh said as much about banks moving out of the UK if the government came down on the bonus culture, and I think that's a real risk, and if that happened then hundreds of thousands of jobs would be lost, not just at high earning level but across the board. Which is why (IMO) no law has been put in place re bonuses and never will.

This is the sort of measure that would have been v old labour and no one would have batted an eyelid if an old school labour govt had brought this in.It is only because new labour are bloody tories in cheap suits that everyone is up in arms.Frankly it should be more and those at the lower wage scale should be taxed less to try and even up the way we all live. Stripey I for one am grateful for people like you and am aghast at what you earn.Have had a few nurses over the year literally stay with me all night through some horrendous times and it is heartbreaking to see what they are paid.One girl in partic who stayed with me after her shift finished while I threw up all over her new cardigan and cried for hours She has since become a friend and earns about 17k

I don't think you can blame people for not wanting to pay more tax. Do any of us really and honestly when times are hard?

I know the moral arguements about the relative value of a nurse versus a banker and have a lot of genuine sympathy with them but individuals have to look to their own welfare and it is the job of Govt to sort out the tax system to make it fair. It is not the fault of highly paid people. I think the entire tax system distorts incentives terribly and needs complete reform. It is very ufair to low paid people.

BigBellas - sorry to shock you there but the scheme I (badly) described is exactly what £1000 an hour accounts and lawyers are working on right now and will be doing all weekend if that is what it takes. If the income tax rate goes up to 50% for people over £150k then the firms who employ people like the DH of hedgiemum will have an incentive find a way round it or leave the country.

MrsMerryHenry - thanks for the correction.

Not in line by a long chalk to pay 51% tax, but pay enough all the same.

What irks me is that if you go to work and slog your guts out, you get taxed to the hilt.

Yet the inheritance tax threshold keeps rising, and the Tories say they'll raise it to £1m. Now THAT annoys me.

If dh earned £500k (ha ha) or I earned it (ha ha ha) we'd lose over half in income tax and NI contributions, but if you in the fortunate position of having a relative with a house of that value, you stand to get the whole amount, just by dint of good luck.

Now that's what I call majorly unfair. It also plays into the hands of 'haves', and leaves the rest of society lagging behind with no hope of catching up, even if they work 200 hours a week in a well-paid job.

The renewed drive to clamp down on tax havens is going to mean that there are fewer places for businesses to flounce off to, thankfully. In the boom years governments weren't that bothered about tax revenue lost to international evasion, but these days they're counting the pennies more and getting tough.

'champagne socialist' - what a splendid expression!

OP: Your DH pays the average amount of tax on his earnings up to the average salary band and then yes, he pays an extraordinary amount of tax on his extraordinary salary after that.

Don't worry, you'll still end up with more money than the rest of us.

As for his job being less secure, well that goes for the rest of us too.

The majority people who got us into this mess are in this tax band.

ABetaDad - I think you'll find quite a lot of people on this thread with a social conscience who don't mind paying higher taxes when times are hard - me included and I earn nothing like 150K