The Rich According to the Guardian

[Judy1234]

www.guardian.co.uk/money/2008/aug/04/workandcareers.executivesalaries

Popps- what advice do you have for people who are approached to use VCT as an IT reclaim instrument?

Re the Vantis article above - that just shows there is an HMRC investigation. It does not show any tax was broken. In my view it is virtually a human right to arrange your affairs within the law to pay as little tax lawfully as you're obliged to pay. There is nothing wrong with that at all. Some idiots will die without giving money away 7 years before they die and give HMRC 40% of all they have. Others will have the wisdom to avoid IHT. I just don't get the objection. Sometimes tax schemes will take a different view from HMRC's view (who by the way often lose the cases they fight as they get the law wrong - pay peanuts, you get monkeys etc)

And then obviously some people probably more of the poor than the rich if we're honest about it, evade tax unlawfully. But that's a different issue.

Unless we very much simplify the tax system then sensible tax payers will always lawfully seek to minimise what they pay.

If oneone wants to come and see how the other half live, they are more than welcome to stay (rent free) in my home.
In return for their keep they can clean my toilet, iron, wash, tidy up (constantly ), look after the garden, wash the floors, hoover, dust, clean the car-inside and out, cook etc etc etc. Oh and go out to work for a pittance as well.

I will be quite happy to swap with someone in the top 10% of earners, and do relatively little and absolutely no housework for the week

top 0.1% atleast in Xenia's case

I do a fair bit of all those things, though. Just because you earn a lot doesn't mean you don't constantly tidy up after children, cook, garden, clean toilets, deal with child sick.

What an unpleasant thread this has been. It is not unreasonable to have concerns about the widening divide in our society. It is a significant social problem. One that leads to gated communities for the "haves" who live in fear of their wealth being snatched by the "have nots" who feel that they have no access to the opportunities that those with even relative wealth take for granted. Wealth mobility is shrinking (the likelihood of someone from a poor background making it to a higher class and/or earning potential) and that leads to people feeling they have no hope of escaping their circumstances. I think it also contributes to those with little hating those with a great deal, and those with a great deal despising those who they see as deserving to have nothing. I really can't see that this is a good thing. Neither does government, as history shows that such divides are a frequent background to revolt, and occasionally revolution. Hence taxation systems are designed to have some redistributive effect, and welfare systems put in place to support the poorest.

I think we should all remember that we don't deserve to be born who we are, whether rich or poor. Yes we should make of life what we can, but if we are successful we should preserve some humility.

Oh, and whilst not all actions are illegal should we really defend those who simply take all they can? My father is an accountant, and I have heard enough tales of how tax advisors work the system to know that this is common place practice. Perhaps the major difference is that the rich take enough care (in general) and have enough resources not to get caught manipulating the system, whilst the poor lack the resources to do so.

I was taught that it was vulgar to brag about having money - surely it is even more so to publicly deride those that don't. Can anyone really be sure that the 90% of the population who earn less than £39,825 are really all stupid or lazy as some appear to think here? I earn more than that, and count myself lucky to do so. Lucky that I had parents who thought it important to educate me, lucky they could afford to do so and that I had the brains to take advantage of it. Anything after that is mine to take responsibility for, but boy did I have a head start on many, and I think it is very sad and blind headed that so many of the successful should apparently forget that.

Nooka- i couldn't agree more with your insightful remarks. Those who do well have some responsibility to the those less lucky. And before anyone says it, that does not mean that we absolve those less well off of any responsibility.

Nooka, I absolutely agree with you. I've been reading this thread and your post is exactly what I have been wanting to say.

But I can't see anyone despising the poor or bragging about money at all. Who has on this thread? To defend the right of tax payers rich and poor to pay only what tax is lawfully due doesn't mean we're bragging about being rich or are saying we despise the poor or even those on average wages of £20k a year. The poor will always be with us and society needs people at various levels so it functions as it is currently set up.

I suspect plenty more poor people who are on benefits or earn under £10k a year evade never mind avoid tax than most middle classes on PAYE earning £20k - £100k or even the very very few rich there are in the UK. In other words our biggest problem in this area is the poor who don't pay tax on undeclared income rather than a very very few rich people who illegally evade tax.

"I was taught that it was vulgar to brag about having money - surely it is even more so to publicly deride those that don't."

I agree with you entirely - it's beyond vulgar and into crassly insensitive and arrogant.

But I haven't seen anyone deride those that don't have money on this thread. Or were you referring to people's comments in the article posted in the OP?

'In other words our biggest problem in this area is the poor who don't pay tax on undeclared income rather than a very very few rich people who illegally evade tax.'

"Wealth mobility is shrinking (the likelihood of someone from a poor background making it to a higher class and/or earning potential) and that leads to people feeling they have no hope of escaping their circumstances ... I really can't see that this is a good thing. Neither does government ... Hence taxation systems are designed to have some redistributive effect, and welfare systems put in place to support the poorest."

Hasn't the gap between the richest and poorest got worse under this Labour Government? Their version of redistribution doesn't seem to be working.

I don't have a problem with the gap between rich and poor increasing as long as the poor are fed. If it makes them jealous, tough - they need to learn to cope with jealousy. There will always be someone better or fitter or happier than all of us.

'Some idiots die without giving money away 7 years before they die.' Well how outrageous, not to have the day of their death marked into their diary.
Tsk. Peasants.

When I said government I didn't mean this government, as in this Labour administration, I meant government in general, but in particular the West. If you look at the introduction of many social changes such as widening the franchise, or labour rights you can see that the establishment at the time acted to some extent out of fear of popular action. Xenia, I think you should become more socially aware. Jealousy is not in itself a problem (except for the person feeling it), and seems to be felt every level in society - I work mainly with doctors, they envy lawyers (why aren't we respected/paid like them) teachers it would appear from some previous MN threads envy policemen (mostly on the pay front). Feeling the grass is greener is not a problem. Feeling however that there is no chance of a future for you and your family is not about jealousy. It is abut despair and futility, and that breeds all sorts of social ills (gangs, drugs, riots at the sharp end to illiterate and unmotivated workers at the other) that will affect everyone. Maybe the super rich can escape the effects by hopping to the next country along that provides a comfy living at the lowest cost possible, but for the rest of us we should be thinking about what sort of environment we want for ourselves and our children.

This country does not punitively tax the rich, or even the moderately well off. Yes it can feel like a big dent in the pay packet, but for those of us earning a good wage it is not as if there isn't plenty left over is it now?

"Hasn't the gap between the richest and poorest got worse under this Labour Government? Their version of redistribution doesn't seem to be working."

I think that any govt that taxed the very rich in order to keep the gap between very rich and very poor would be slaughtered. That is a political reality. I think that it is pragmatic for a govt to allow some level of wealth creation but at the same time try to take as many kids as possible out of child poverty. Before recent energy price inflation the UK had started to make some progress in that regard. This is why I say that we have to keep an eye on both relative and absolute poverty. And as the country gets richer the gap between rich and poorer will widen. What you have to do is then use some of the wealth to ensure that you minimise the numbers caught in the (absolute) poverty trap.

Should be "I think that any govt that taxed the very rich in order to keep the gap between very rich and very poor CONSTANT would be slaughtered."

I just mean everyone has a rough idea of life expectancy. Inheritance tax for most people (for those few who are over the £312k limit or whatever it is) is therefore a voluntary tax in a sense.

I just don't understand why people criticise people who engage in lawful minimisation within the law of their tax bills when everyone in the country does it anyway even if just to claim their allowances.

I do think tax is far too high but I accept 41% (the top rate (NI plus tax) on upper earnings in the UK) is lower than in some other countries. When we reduced taxes from about 60% + to 40% we increased the amount of tax we took in.

Yes, I know doctors envy lawyers. My brothers is a consultant psychiatrist but they know when they pick that job that they'll be paid by the state and what the up and downsides are.

If income support rates are low but enough so that people don't die of starvation that is hugely beneficial to the poor because there is a massive incentive to try to become the next Alan Sugar or LK Bennett or perhaps even to get that job in the call centre because it's better paid than income support etc.

I think that we got into a hole about the tax issue. The bigger point for is that a country which gets richer will have a resultant widening in the gap between rich and poor. But, within limits the govt should ensure that the collect some of that wealth to help the most vulnerable in socitey. That is a measure of the decency of a nation. I have always found the UK to be an attractive country for that reason. But is disappointing that we have had a good 15 year run in this country, yet we whinge so much about marginal tax increases.

I picked my job because I love what I do and I am a help to people. Not everybody is driven by money. I have no desire to do any extra education to further my 'career' and therefore earn more. This isn't a failing on my behalf, I just prefer to be happy.

tough daddy I think you have spoken a lot of sense re absolute and relative poverty. The idea that one of the measures of poverty in this country is whether you have a mobile phone or not has always seemed ridiculous to me.
However, the increases in taxation you call marginal I have to disagree with. The economy was undergoing a period of sustained growth. Why raid pensions, then when we should have been encouraged to put money away?
And to whoever was complaining about self employed people paying less tax- we pay much more than we used to and therefore it is much, much more difficult to turn a profit than it used to be. I don't say that from my ivory tower- my business turned over 300k last year of which I got 27k. Hardly a fortune. And I have all the risk. I know many people who are wondering whether it is worth all the hard work and if I shut my business, 8 people lose their jobs

On the pension front, well the article has plenty of derogatory statements, mostly along the lines of "well I work hard for what I have, therefore everyone who doesn't have what I have must be either lazy or an idiot". Then there is pretty much everything Xenia has said here, starting with the idea that "We look after people They don't starve. They are very lucky." No, those who are rich are the lucky ones. Those who are starving are just very very unlucky. Oh and people like Xenia who seem to think it a civic duty to avoid paying taxes whenever possible (after all tax is theft) can't really claim to be one of the "they" who are looking after the "people", they can however apparently sop their consciences by thinking that the poor should be "jolly glad they live here". The concept of paying into a common pot for the common good is fairly embedded in our political and social system here and one that we all benefit from. If you think it reasonable to banish all the "lefties" to the few remaining communist countries, then perhaps you should consider moving to a country in an active state of anarchy - say a nice war zone? I don't see that "rich is right" is that far off from "might is right".

Anyway, I like this quote the best for us all to live with (except the church bit as I am an aetheist):

"If they compared themselves to people who are less fortunate and perhaps went to church more and weren't so materialistic they might be a lot happier."

Well, I would move if the tax burden got too high. Just as I moved away from family to find work.

We look after the poor well in the UK.

But certainly riven's situation sounds difficult but UK state benefits are much better than many other countries and most people don't starve or freeze to death. It is nothing like as bad as it is in some countries.

I don't think any tax payers really choose to pay extra tax or not to claim personal allowances and the standard things people do to ensure their tax bills are lower. I am glad we have some kind of welfare state. I would radically change it and chop it down and cut out all the many many new quangos Labour set up and complexities in the tax and benefits system however.

Yes, some peopleare so disabled they cannot work although this Government is proposing new tests to see what work people can do. I don't know about your daughter - if she cannot speak or use her hands that's certainly very disabling as it rules out voice recognition software on line and typing. I am sure you would like to find something she can happily do if that is possible. can she do art work with feet? We bought Christmas cards drawn by people without hands but obviously I have no idea about her problems but I bet mumsnetters could help and give ideas if they can.