Should the rich pay more tax?

[CharlieP]

Originally Posted by Rigadon

I dont want to be too picky over minutae but there are enough oddites in htese figures

tax and NI on 100k is only 35k

I never doubted your figures for a second, but just in case anybody thought you were plucking them out of the air, this is what an employee earning £100,000 would be liable for in 2008/09:

£30,626.00 Income Tax
£4,489.20 Class I National Insurance
========
£35,115.20

[Octoman]

Enough to keep three scum families stocked up on Mayfair fags and Skol lager for a year!

The sad thing is that people have lost so much faith in the ability of our benefits system to allocate money where it is really needed that the types of thoughts above really are held by some.

£35k per year tax is more than enough by the way.

[Republica]

I agree that on 100k 35k tax is enough. But for those above and beyond i think we should raise and create a top band of at least 50%.

[gothicform]

yes. thats my argument. 100k is NOT rich. if you want to buy a house and have no equity then today it won't even make you wealthy. if you want to have kids you will struggle to do things like raise them and have one holiday a year. of course, as the income increases above 100k the basics you NEED for a half decent standard of living (we're not talking champagne, cigars and designer clothes here) are paid for and so your living standard will rise and rise. i would support a top rate of tax of 50% on those for example earning over 200k but i think 100k is too low.

[moseeds]

I don't care how many figures you throw at me, but claiming you'd struggle to raise kids on 100K a year is bordering on ridiculousness.

[JDRS]

Originally Posted by Octoman

£35k per year tax is more than enough by the way.

It depends what you're earning. If someone's earning say £300k they should obviously pay a lot more tax than £35k because that's a small proportion of their earnings. Otherwise we end up in the ludicrous situation where the poorest pay a higher proportion of tax than the wealthiest as has happened. How is that fair?

Gothic don't be so ridiculous. Saying a family on £100k can't afford one holiday is absurd and untrue. Most families on a lot less than this manage one a year. I know families on around £100k who have two or even more holidays a year. You don't need £100k for basics unless these 'basics' are unrealistic. Anyone in the top 10% of incomes is rich in my mind. But yes the top rate should be fair (I'd personally put it at £80k) as it does seem fairly low at the moment. Or maybe the rate should be aligned to earnings as a percentage of the population so that the top x% always get taxed the top rate and it therefore adjusts each year.

[gothicform]

I don't care how many figures you throw at me, but claiming you'd struggle to raise kids on 100K a year is bordering on ridiculousness.

not at all. you get NO help from the govt. NO tax credits. people earning say 25000 a year get tax credits, they also get help paying for things like nursery care and so on. the value of these benefits runs to tens of thousands a year if they have two children.

i give up with this thread. people are stupid and do not realise that living standards and consumption have NOTHING to do with income and that its possible for someone to have lower living standards and earn more money than someone with higher living standards and a lower income.

[mexico86]

Originally Posted by gothicform

that living standards and consumption have NOTHING to do with income and that its possible for someone to have lower living standards and earn more money than someone with higher living standards and a lower income.

that can be true, yes.

[Octoman]

Originally Posted by JDRS

It depends what you're earning. If someone's earning say £300k they should obviously pay a lot more tax than £35k because that's a small proportion of their earnings. Otherwise we end up in the ludicrous situation where the poorest pay a higher proportion of tax than the wealthiest as has happened. How is that fair?

Gothic don't be so ridiculous. Saying a family on £100k can't afford one holiday is absurd and untrue. Most families on a lot less than this manage one a year. I know families on around £100k who have two or even more holidays a year. You don't need £100k for basics unless these 'basics' are unrealistic. Anyone in the top 10% of incomes is rich in my mind. But yes the top rate should be fair (I'd personally put it at £80k) as it does seem fairly low at the moment. Or maybe the rate should be aligned to earnings as a percentage of the population so that the top x% always get taxed the top rate and it therefore adjusts each year.

I think I could live with tax reform if they did something like the following :

50% rate for earnings in excess of £200k
Move the 40% starting band to £80k
Charge no tax on first 12k earned.

[VaastuShastra]

Makes sense.

[PresidentBjork]

Originally Posted by Octoman

I think I could live with tax reform if they did something like the following :

50% rate for earnings in excess of £200k
Move the 40% starting band to £80k
Charge no tax on first 12k earned.

This would be better in some regards, but I would be reticent about charging a person earning £70,000 the same level of tax as someone earning £22,000. The numerical difference between the two is much greater then that between 12-22,000 bracket, but the difference in taxation and it's subsequent effect is much greater for the latter. Numbers aren't everything I know, but I stand by this point.

I would personally add 30% bracket at the £50,000 a year mark. This still means a significant chunk of the population will pay less tax helping to lift the burden off the middle class.

I would agree that those earning £12,000 a year shouldn't pay income tax. I know a couple of people who fall in this bracket. The recent rise of 10% on what they have to pay has been a real ball breaker. They're young and aren't relying on their job for the bear essentials of life, but this heavy tax burden still bites hard. Of course, they are entitled to that tax rebate thingy, but after months of trying neither have seen a penny. When it does come through it won't do much to help them when they were paying more, but receiving less.

Loses to treasury would hopefully be offset by that small number of high earners paying that 10% more. Overall the vast majority of people will benefit. But this does not mean the very wealthy have to be victimized - and from what I can tell this perception is what troubles people most. The increase they pay will be insignificant in it's effect on their quality off life. In turn, this small loss will be the price for substantially improving the quality of life for a lot of other people. This is not a perfect solution but I would say it was fairer.

This progressive taxation is often criticized as being forceful redistribution of wealth from the rich to the poor. Obviously, this troubles our concept of just rewards for individual initiative. But I will say one thing, although it is true progressive taxation aims to redistribute some wealth, does it not work in reverse? If one is to accept this theory of unintended consequence one has to accept it works both ways. In recent years the very wealthy have seen their incomes skyrocket at rates which far exceed annual economic growth. It is logical to then assume some of this accrued wealth has come at the expense of others in society. A lot of people balk at the suggestion of taking money from the rich to help the less well off and see it as really unfair; however, wealth has been leaving the poor to enrich the most affluent for many years now. I believe this has been, in part, the result of government decision (whether it be lighter regulation and economically expedient tax regimes) which means (at least in my view) any concomitant effort to redistribute that wealth is not so unfair.

[wjfox]

http://mercypolitics.blogspot.com/20...-or.html#links

Wednesday, May 13, 2009

Core Issue: Wealth Redistribution or Revolution.

If you click on the title, it will take you to a fascinating document.

This academic document presents details on the wealth and income distribution in America and explains how wealth & income are crucial power indicators. Further, it explores the critical underlying question of what and who rules America.

I just want to highlight a few critical points contained in this document.

In 2004 the top 1 % of the US population, in terms of income & assets, controlled 42 % of the total financial wealth. On the other hand the bottom 80% controlled a meager 7 %.

Another stunning example of this obscene social inequality is the pay of CEO's compared to the salary of production workers. From 1990 to 2005, CEO's pay increased 300 %(adjusted to inflation) while workers gained a scant 4.3 %.

The slippery slope of this extreme gap between the " haves " & the "have- nots ", while always a factor in America's social makeup, took a dramatic turn for the worst from 1983 on.

It is not a surprise that it corresponds with the Reagan era and its promotion of wealth concentration and systematic deregulation of the financial market. The very concept of the "trickle down " economy. The Clinton administration did absolutely nothing to reverse this dangerous trend.

In good economic times, this type of system can be sustainable, at least for a while as long as the "little guy" stays happy with the few crumbs coming his way. However, the global economic crisis and financial meltdown has changed the equation. The trickle of wealth has dried up.

Historically, there are only two outcomes of such a situation: A Revolution or a peaceful wealth redistribution from taxation.

From 1789 on, all revolutions and/or social unrest had the same root cause: Namely concentration of wealth & power among an aristocracy or an elite. This applies for France in 1789, Russia in 1917, China in 1949 & Cuba in 1959. The only way to avoid such violent events is by voluntary reforms of the system.

This would entail a drastic income tax increase for the top 1% of the US population, but more importantly a reform of the "death tax" ( estate tax). In Europe, it is the key tool for wealth redistribution. Some countries tax as much as 60 %. It seems that it is the only fair & logical way of leveling the social "playing field".

This position is not about ideology, it is about sound government looking after the majority's common good, as opposed to our current system run by the elite, strictly for their own benefits and the one's of their children.

So what is it going to be: Peaceful reforms or a Revolution?

[larven]

Originally Posted by wjfox

So what is it going to be: Peaceful reforms or a Revolution?

Either, as long as something happens to reverse this trend. The ideology that has allowed this has collapsed so hopefully more wealth will find now find its way down to the poorer classes.

Pure greed and selfishness are not good for wider society and rich people who moan about the underclass should be thoroughly ashamed of themselves.

[wiggleyleeds]

Originally Posted by gothicform

i give up with this thread. people are stupid and do not realise that living standards and consumption have NOTHING to do with income and that its possible for someone to have lower living standards and earn more money than someone with higher living standards and a lower income.

totally agree.

when you earn a lot more, you consume a lot more in your lifestyle, and so a married couple with a 3 bedroom house in chelsea, with 2 kids, both parents working long hours, amounting to a combined income of 100k per annum will probably be significantly "poorer" than a different couple in different circumstances on a combined wage of 40k.

[Republica]

What is preventing revolution at the moment is that even the poorest people in westernised nations are, on the whole: not starving. have somewhere to live. fit in to at least some part of society.

Its good to see labour implemented what i wanted back in september with the 50% tax rate.

I believe death tax as mentioned in that article is 40% here ie. inheritance.

[wjfox]

The gargantuan mountain of cash that separates the rich from everyone else

http://www.jmooneyham.com/the-huge-m...yone-else.html

[bigchrisfgb]

Originally Posted by blahblah

Why should someone who has worked hard to get qualifications to get a good job, and worked hard to do well in that good job be punished for it?

A lot of people are rich for a reason - becasue they've worked bloody hard for what they've got.

Apply the same logic to sport - shall we dock points from Man Utd and give them to Newcastle Utd?

Everybody should pay the same level of tax, as a % of their income.

And, WJFox - The way you've worded the poll - I thought you were better than that - I just lost a little bit of respect for you.

Yes

But seriously, I agree, if someone actually works hard to get to that position, then why should they be punished for it?

So, no the rich shouldn't be taxed more, but they shouldn't have ways to get out of paying it either.

[PresidentBjork]

er, because indirect taxes cumulatively have a far smaller impact on them?

[gothicform]

yes. and the point of my above post is that it's quite possible for a 50 year old person with an income of 40,000 to have a comparable lifestyle and living standard of a 30 year old with an income of 150,000 thanks to the huge difference in house prices between when the 50 y/o purchased and today.

[Rumors]

Most definitely.