bye bye 10p tax rate

[beckyvicky]

I work with 2 secretaries, we all work part time ( I do the accounts). We all work P/T and do not earn v much and fall in the (now gone) 10p tax band. So on Tuesday I asked them both how they felt about losing their 10p tax band and going up to 20p. Neither of them knew about it, despite it being on BBC breakfast TV etc.
Now I know I'm a sad git who lives in a world of numbers,but I was absolutely flabbergasted that 2 women in their 30's/40's, with kids, husbands, jobs, general interest in life etc were oblivious to the fact that their tax bills just doubled overnight.
Do other people know....?
Am I just too sad?

It has been big news, although only for a day or two.

Hopefully this will be a nail in the coffin of this hopeless government.

What ScienceTeacher said.

But there tax bills have not doubled. If they have kids and are earning under the threshhold for tax credits then they will recieve increased tax credits to make up for the loss, and if they are earning over the £60k or whatever it now is for WFTC (as a family) then the cut in the basic rate of tax from 22 to 20% will more than make up for the loss.

The only people who will actually lose out in this are people unable to claim tax credits (ie, without dependant children). I think anything that moves the tax burden away from families is a good thing.

And pensioners, Pru, like my ILs.

And college/university leavers already with huge debts whilst Blair and Brown got theirs gratuit.

And lots of lots of working poor people.

But who cares about all them?

Oh, yes, get more people reliant on Working Tax Credits so the TCO can f*&^ it all up and then come back to you years later and tell you you owe them thousands. Now. And to pay it back, you'll live below the poverty line.

That's the best this Government can come up with.

Their tax has increased, and let's face it, an awful lot of people don't claim their entitlements to benefits because of the clawbacks when you earn / have savings above a certain amount, or because they don't want to do the means testing as they consider it intrusive.

IIf they are on a low income, like my Mum, then the tax take has doubled, from 10% to 20%. Yes, the basic rate had dropped to 20%, but for some people the NI has increased, wiping out nearly all of that gain to boot. What the government giveth with one hand, they taketh away with the other. If they were really serious about lifting people out of poverty, they'd raise the tax free allowances to a sensible level, and take the lowest paid out of the tax systen altogether, thereby obviating the need for tax credits and all the highly expensive admin that goes with it.

all 3 of us are on low enough incomes not to reach the (old) 22% level so we don't benefit from the reduction to 20%. don't know too much about their personal finances - ie husbands income, but suspect they can't claim tax credits due to household income. Still, it's a shame for low-paid Mums as individuals; if you are unlucky enough to have a husband who doesn't "pool" family income you have to shoulder your new tax burden yourself from your own net pay.
But I was more shocked at their lack of awareness that it had happened at all.

Sorry but "unlucky" to have a dh who doesn't pool family income? Rather silly IMHO to allow such a situation. I refuse to feel sorry (on monetary grounds) for anybody who earns over the threshold for WFTC.

The tax system is not the place to put right the problems of an education system that encourages young people to get into debt whilst getting a worthless degree. you can't make fundamental tax policy based on the crapness of the administration of teh tax credits system. And I believe that any pensioner who loses out also will come under the threshold for PTC.

Means testing is no more intrusive than me filling in the tax returns that have just landed on my doormat. The government and tax system has a legitimate need to know how much money every citizen has to ensure fairness of contribution to public coffers.

Whilst I completely agree that the tax free allowance should be significantly increased to get more people out fo paying any tax altogether, (and I think that everyone - SAHP, children - should be given a personal allowance that can be offset against the family income, thereby obviating any need fro teh ridiculously over compliacted tax credit system) I can't disagree with what is basically a simplification of the tax system.

And I do think it's awful that these women are not aware of the change - it's not like it hasn't been public for a long time. But it's simply indicative of the fact that people have become less interested in politics, which is one reason why governments are able to get away with doing the crap things they do.

How would you pay for this PA increase, Prufrock?

Remember it's not so long ago - when most of us started work in the 70's- that a woman was seen as part of her husband's tax situation and could not fill out her own tax return, her income was returned as his, even if she earned more than him.
btw I know of several families via school where a married couple's finances are not mixed and the wife has no real idea of what her husband earns and she pays for "household" things out of her wage, even if it is a low wage.
Silly maybe but that's the economic reality for a lot of women.

1990 even - independent taxation of married women - dreadful to think that's only 18 years ago

'The tax system is not the place to put right the problems of an education system that encourages young people to get into debt whilst getting a worthless degree.'

So in other words, if you study something like nursing or social work or anything that's not going to earn you lots of money right off the wicket, then you deserve to be taxed even more.

'you can't make fundamental tax policy based on the crapness of the administration of teh tax credits system. '

Um, last I checked, the tax credits system IS incredibly fundamental to Labour's tax policies.

'And I believe that any pensioner who loses out also will come under the threshold for PTC. '

Haahaahaaa.

But still, thanks for the glimpse inside the workings of the Labour mind.

I'll keep that in mind when next I go to vote and when the time comes to volunteer my time for candidates.

In other words: all you folks out there getting stung by Brown's latest tax policies to come into effect: you deserve all you get.

Think about that next time you go to the polls!

Pru are you my MP? I complained to him a year ago when this was announced and he sent me a letter much like your first post on this thread. No I am now worse of and my tax bill has doubled - blardy disgrace. Not until you are earning £35k do you actually benifit from this system. But if you earn between £6k-£18k you are worse of not as much money in your take home pay means you are worse of however you want to try and dress it up.

I don't mind filling in my tax return Prufrock, especially as I don't pay any, but for those of an older generation, they won't fill in the means testing forms as they see it as intrusion and in many cases, receiving state help smacks of charity. My Nan, who was 93 when she died was like this. She could have received more on her pension, but to her it was redolent of the workhouse and the poverty she had endured in childhood.

I also fundamentally disagree with you. 'The government and tax system has a legitimate need to know how much money every citizen has to ensure fairness of contribution to public coffers.' They need to know no such thing. If I work I am taxed via the PAYE system, but they have no need to know how much I have stashed under my mattress for instance, or how much I have inherited as long as tax as been paid on that inheritance, or none, if it is under the IHT threshold. I do not give them details of my savings; only any tax paid on them. They may need to know about earnings which can be taxed, but not how much every citizen has. If you go down that road, they'd want to tax you on how many pairs of shoes, knickers or diamond earrings you have!

If you earn between 6 and 18k and have children the WFTC will make up the drop in income though.

Scary -you are right, I phrased it incoorectly. I agree that the only info the state is entitled to is about your income. I'd pay for it by charging higher earners more tax (but by reducing level at which 40% kicks in rather than increasing the rate). Oh and my own personal bugbear, making all inherited money taxable as if it was earnings.

becky - I'd quite like the option to be able to pay tax as a family. It strikes me as grossly unfair that a family where both partners WOH 2.5 days a week so they can juggle childcare are able to take home significantly more of their wages than one where one partner WOH 5 days and the other SAH to look after kids.

expat - given the choice of whether the higher tax burden should fall on a childless nurse or a low earning family I'd choose the childless nurse every time.

'expat - given the choice of whether the higher tax burden should fall on a childless nurse or a low earning family I'd choose the childless nurse every time. '

I find that intrisically unfair. Is it her fault she didn't go out and spawn? Maybe she can't have kids. Maybe she's got other burdens on her time and life?

Why should she, the childless nurse, matter any less than any other citizen?

I hope you can at least appreciate how much that alienates and pisses off MANY low-income people from this Government.

The solution is to not tax EITHER of them so damn much.

Raise the personal threshhold and scale back tax for ALL low-income people.

How to pay for it?

Tax high-earners more, particularly high-earning non-doms.

If you look from the viewpoint that the taxation system is the government's way of getting us to change our behaviour, it is logical that it should favour families over childless people.

it does not seem logical, when compared with their immigration policies and the growning percentage of the population which is heading into pensionable age.

Well if you'd bothered to actually read my posts expat you'll see that I agree with raising PA's.

It's not a case of a childless nurse not mattering, it's about using the tax system to help out those who deserve help. And I do stand by my opinion that a low income family deserve more help than a single worker. I presume if you don't agree that there should be financial benefits to having a family you hand back your weekly child benefit? Or that you'll be donating the amount you'l be better off by (because earning under 20k with 2 kids wil make you about £150 a year better off in this budget) to your nearest single nurse?

And you can't tax wealthy non doms more - it would be nice if you could, but they will jsut go somewhere else if yout try.

'And you can't tax wealthy non doms more - it would be nice if you could, but they will jsut go somewhere else if yout try. '

And we can't be having that when they're propping up what's left of an economy after so many years of Labour government.

Seeings as that the TC bureaucracy lost about £6b in its first 4 years of operation, riven, I wouldn't count on them to get it together anytime soon.

I get £48 per month from CTC (woohoo )...however, the payment this month was over £100... so could it have been adjusted automatically by that much and so quickly??

yes, then you'll get another letter demanding £100,000 yesterday because you were overpaid 5 years ago.

we'll still be paying the gas bill from this winter come next winter, riven.