We're All In This Together .....

[Lateralthinking1]

there are suggestions that Orwell predicted the future so accurately, (one that has come to pass in out country in our time), because he was an insider , and knew the agendas.
it wouldn't suprise me.We are in a mad world indeed. Socialism for the rich, capitalism for the poor.
As Randy Newman says "where the rich just keep on getting richer, and the poor you don't ever have to see".

I find it disorientating. Tuning into the news is often like finding myself in a different time zone.

Don't know about Orwell's background fully. Being lowly and at the centre, there were many different vibes. Being keen on directness with the public - public service - I gave many colleagues the benefit of the doubt that they had similar motives. Old school did, definitely even to those still in their forties now. Some of it is shadowy and managed but I think there is a lot of sleepwalking - "we're doing alright for ourselves financially, a grand job done, suspicions are for nutters". The most distinctive cut off point was Grade 3, beyond which another world. I guess with hindsight, some of the key developments were:

1990s - Very senior management became "middle class wide boy" but just as aloof. New emphasis on being "as good as" the private sector. Managers more important than thinkers. Introduction of Californian-style business language to replace patrician style - more gloss than substance. Far nastier feel than in the Thatcher era which oddly to me felt internally the kindest period.

1997 - Two days of excitement and sense of change. "The PM wants to be referred to as Tony". Then loads of special advisers appearing. It was almost as if ordinary civil servants were in the way. News then that Prescott wants to be referred to as the Deputy Prime Minister. Still, welcoming enough although cronyism rife. Bit sloppy in places. Machine like in others. Irritation with the public over FOI. Requests reluctantly met. Fears about court cases from the very wealthy with policy adjustments.

Brown onwards - Felt sinister. The Coalition regime felt far more like a logical extension of Brown's time in tone than Brown's premiership ever seemed like an extension of Blair's. Arguably the difference was that the employees didn't seem to matter much under Brown whereas under Cameron they mattered even less and the public also seemed to be ditched in unprecedented ways. "Too much time spent on dealing with their issues - cut it out and do what the Secretary of State tells you to do."

[Flosshilde]

http://www.telegraph.co.uk/finance/b...ld-defuse.html

The key sentences are -

" A Treasury study currently underway still has too little data to draw any proper conclusions, but anecdotal evidence is flooding in. London is full of leaving parties for people heading to Dubai or Asia. A recent survey of millionaires by Skandia, a financial consultancy, found that just over half say they may emigrate"

So really nobody knows what impact the 50p rate has on people staying or leaving, & the article's just so much flim-flam & special pleading.

[teamsaint]

The key sentences are -

" A Treasury study currently underway still has too little data to draw any proper conclusions, but anecdotal evidence is flooding in. London is full of leaving parties for people heading to Dubai or Asia. A recent survey of millionaires by Skandia, a financial consultancy, found that just over half say they may emigrate"

So really nobody knows what impact the 50p rate has on people staying or leaving, & the article's just so much flim-flam & special pleading.

Although not the case here particularly, you can always find somebody smart to coherently and powerfully argue any point of view.
The whining of the very rich about a tax rate which is actually not all that high by most western standards, is particulary gallling.

Let them emigrate. Most of the pampered elite are replaceable, they just want us to think that they aren't.

Including the national insurance figure obscures something else.....that the main rate of 11 p (?) finishes about £100k before the 50p rate kicks in.
It is the lower and middle earners, and especially the self employed, who actually pay the NI.

[Flosshilde]

One thing that hasn't been mentioned is that if you earn over £100,000 you don't get a personal allowance, so the 50% rate is really a bit more than that (but I'm not putting forward that as a reason for getting rid of it) :smiley:

[ahinton]

Any argument about the percentage of any individual's net disposable income after tax and the percentage of his/her gross income that it represents must take into account all income tax payments for which he/she is liable and, since NIC is a part of that, the actual amount of NIC needs to be added to the income tax to arrive at that percentage.

Teamsaint's assumptions about employees' NIC liability conflicts with the information on the current year's tax rates card supplied by my bank which states that, for the current tax year, all employed taxpayers are exempt up to £7,228, "contracted in" ones are taxed at 12% from that figure upto £42,484 and "contracted out" ones at 10.4% from £7,228 up to £40,040 and at 12% from that figure up to £42,484 and all employed taxpayers are taxed at 2% above £42,484 with no upper limit, which suggests that the more an employee earns, the more NIC for which he/she will be liable; these rates are all 1 percentage point higher than those that applied last year and most of the thresholds (except the examption one) have also decreased since last year, thereby increasing the anmount of NIC due. In addition, "contracted in" employees generate NIC liabilities for their employers of 13.8% from £5,720 upwards with no upper limit, a rate also 1 percentage point higher than in the previous tax year.

Personal income tax allowances reduce by £1 for every £2 of taxable income from all sources from £100,000 upwards until it expires altogether; the 40% income threshold has also been decreased since last tax year from £37,400 to £35,000, thereby increasing the income tax liability of anyone whose taxable income from all sources exceeds £35,000.

On this basis, then, a "contracted in" employee with a £200,00 annual salary will have no personal income tax allowance and be liable for income tax at 20% on the first £35,000, 40% on the next £115,000 and 50% above £150,000 as well as NIC at 12% from £7,224 up to £42,484 and at 2% above that figure so, by my calculations, his/her liability to tax on earned income will be £7,000 + £46,000 + £25,000 + £4,231.20 + £3,150.32, which totals £85,381.52 and his/her employers' liability will be £26,810.64, making a grand total of £112,192.16, i.e. over 56% of the total of earned income.

A self-employed sole trader with profits of £200,000 will be liable for the same amount in income tax as a "contracted in" employee and for Class 2 NIC at £130 and Class 4 NIC at 9% from £7,225 up to £42,475 and at 2% above that figure so, with an NIC liability of £130 + £3,172.50 + £3,150 which totals £6,452.50, so the grand total liability - £78,000 + £6,452.50 - is £84,452.50, which amounts to a little over 42% of all taxable income.

Teamsaint's assertion that it is "the self employed, who actually pay the NI" - assuming this supposedly to mean that the self-employed generate more NIC liability than the employed - is demonstrated by the above example to be not merely wrong but way out, with the employee generating NIC totalling £34,192.16 and the self-employed sole trader generating NIC of £6,452.50, a difference of £27,739.66, so the self-employed sole trader generates less than 19% of the NIC liability generated by the employee on the same £200,000 figure.

Each of the two examples above reveal very high rates of total tax on income. Not everyone with a high taxable income belongs, as Teamsaint asserts, to a "pampered élite" and whether or not any or all of them might be deemed "replaceable", as he suggests, it is obvious that, once any of them leave the country, HM Treasury will be unable to replace the tax that they generated before they did so; what good that would supposedly do to the amounts in the Treasury's tax coffers and the country's solvency is far from clear.

It is also worth noting that Teamsaint's terms of reference are confined to tax on incomes, which are by no means the only taxes for which taxpayers are liable; an individual's total tax take can therefore be considerably higher than in the examples above, although there are, fortunately, tax planning procedures and instruments that can be used to control the amounts of most taxes that are due (pension contributions, ISAs, careful management of sales and purchases that might attract CGT, IHT planning, &c.).

[John Skelton]

and whether or not any or all of them might be deemed "replaceable", as he suggests, it is obvious that, once any of them leave the country, HM Treasury will be unable to replace the tax that they generated before they did so; what good that would supposedly do to the amounts in the Treasury's tax coffers and the country's solvency is far from clear.

It's also far from clear that many of them actually will go anywhere: they can't all go to Dubai or "Asia", and the "brain-drain" theory does depend on people in Dubai or "Asia" sharing the high opinion that the 'brain-drainers' and their panic button presser mates in the press have of themselves. And if some of them do go no doubt somebody else will come along and condescend to make considerable amounts of money. It's all a load of scaremongering self-serving ****. IMO. :smiley:

[amateur51]

Any argument about the percentage of any individual's net disposable income after tax and the percentage of his/her gross income that it represents must take into account all income tax payments for which he/she is liable and, since NIC is a part of that, the actual amount of NIC needs to be added to the income tax to arrive at that percentage.

Teamsaint's assumptions about employees' NIC liability conflicts with the information on the current year's tax rates card supplied by my bank which states that, for the current tax year, all employed taxpayers are exempt up to £7,228, "contracted in" ones are taxed at 12% from that figure upto £42,484 and "contracted out" ones at 10.4% from £7,228 up to £40,040 and at 12% from that figure up to £42,484 and all employed taxpayers are taxed at 2% above £42,484 with no upper limit, which suggests that the more an employee earns, the more NIC for which he/she will be liable; these rates are all 1 percentage point higher than those that applied last year and most of the thresholds (except the examption one) have also decreased since last year, thereby increasing the anmount of NIC due. In addition, "contracted in" employees generate NIC liabilities for their employers of 13.8% from £5,720 upwards with no upper limit, a rate also 1 percentage point higher than in the previous tax year.

Personal income tax allowances reduce by £1 for every £2 of taxable income from all sources from £100,000 upwards until it expires altogether; the 40% income threshold has also been decreased since last tax year from £37,400 to £35,000, thereby increasing the income tax liability of anyone whose taxable income from all sources exceeds £35,000.

On this basis, then, a "contracted in" employee with a £200,00 annual salary will have no personal income tax allowance and be liable for income tax at 20% on the first £35,000, 40% on the next £115,000 and 50% above £150,000 as well as NIC at 12% from £7,224 up to £42,484 and at 2% above that figure so, by my calculations, his/her liability to tax on earned income will be £7,000 + £46,000 + £25,000 + £4,231.20 + £3,150.32, which totals £85,381.52 and his/her employers' liability will be £26,810.64, making a grand total of £112,192.16, i.e. over 56% of the total of earned income.

A self-employed sole trader with profits of £200,000 will be liable for the same amount in income tax as a "contracted in" employee and for Class 2 NIC at £130 and Class 4 NIC at 9% from £7,225 up to £42,475 and at 2% above that figure so, with an NIC liability of £130 + £3,172.50 + £3,150 which totals £6,452.50, so the grand total liability - £78,000 + £6,452.50 - is £84,452.50, which amounts to a little over 42% of all taxable income.

Teamsaint's assertion that it is "the self employed, who actually pay the NI" - assuming this supposedly to mean that the self-employed generate more NIC liability than the employed - is demonstrated by the above example to be not merely wrong but way out, with the employee generating NIC totalling £34,192.16 and the self-employed sole trader generating NIC of £6,452.50, a difference of £27,739.66, so the self-employed sole trader generates less than 19% of the NIC liability generated by the employee on the same £200,000 figure.

Each of the two examples above reveal very high rates of total tax on income. Not everyone with a high taxable income belongs, as Teamsaint asserts, to a "pampered élite" and whether or not any or all of them might be deemed "replaceable", as he suggests, it is obvious that, once any of them leave the country, HM Treasury will be unable to replace the tax that they generated before they did so; what good that would supposedly do to the amounts in the Treasury's tax coffers and the country's solvency is far from clear.

It is also worth noting that Teamsaint's terms of reference are confined to tax on incomes, which are by no means the only taxes for which taxpayers are liable; an individual's total tax take can therefore be considerably higher than in the examples above, although there are, fortunately, tax planning procedures and instruments that can be used to control the amounts of most taxes that are due (pension contributions, ISAs, careful management of sales and purchases that might attract CGT, IHT planning, &c.).

Is a précis possible please, ahinton? :erm:

[ahinton]

It's also far from clear that many of them actually will go anywhere: they can't all go to Dubai or "Asia", and the "brain-drain" theory does depend on people in Dubai or "Asia" sharing the high opinion that the 'brain-drainers' and their panic button presser mates in the press have of themselves. And if some of them do go no doubt somebody else will come along and condescend to make considerable amounts of money. It's all a load of scaremongering self-serving ****. IMO. :smiley:

Well, I was not the one who implied that everyone whose income exceeds an as yet undetermined and agreed figure would automatically emigrate and I have never believed that they would do so, but most of those who would not do this would instead resort to more - and more comprehensive - tax planning exercises in order to ensure as much control over their overall tax liabilities as possible.

Some might also seek to take whatever advantage they could of the ×-day residence rules which vary from country to country but which apply in most Western countries, in order to avoid as much tax liability as possible; this latter exercise is by no means as easy as once it was, is more diligently policed than it used to be and usually requires the individual to divide his/her time between more than two countries these days in order for it to work.

Then there's the incorporation option which has always been open to the self-employed and which has recently been revealed as having also been seized upon by certain employees with the co-operation of their employers to their mutual advantage; the morality of the employee/employer trying this on may be open to question (and it has indeed been questioned of late) but at least some of those who might be concerned about this but who still want to take advantage of it in principle may well feel encouraged to ditch their well-paid employed jobs and go self-employed and then form a limited company to purchase the self-employed sole trader's assets.

Then, of course, ther are the government sponsored tax dodges that I've mentioned previously, including ISAs and pension contributions which are open to most people, not just those who receive high incomes. The higher the tax rates, the more people will resort to any or all of these procedures in order to preserve the values of their incomes and assets - and there is absolutely nothing that any government can guarantee to do about it.

The other problem, of course, is that some people also feel profoundly aggrieved at the ways in which their tax payments are mismanaged and ill-advisedly spent, not to mention the sheer complexity and consequent high running costs of the tax inspection and collection systems compounded with the additional costs of errors made within them.

Finally, there is the inherent danger of moralistic talk of taxpyers "having a stake in the country", if that is indeed true, one has to accept that those who pay the most tax have the highest stakes therein and are thus more able to wield power and influence over their governments because of the extent to which they fund them.

[aka Calum Da Jazbo]

er yep if you earn a lot and are honest with no dodges you will end up paying some 50-60 % of annual incomes to HRMC according to ah calcs

when other capitalists are bragging about the uk it is our low tax and non dom rules that account for all those foreign millionaires spending fortunes in Harrods, mayfair car showrooms and keeping Phillipino slaves a fact that Nelson in the Torygraf conveniently overlooks

the data on the increased and increasing inequalities in wealth and incomes are incontrovertible and ample evidence of the returns to venture as well as its futility .... this is specious self interested nonsense of the worst kind ... rich and bosses get richer yet we are all worse off, why would letting the rich off some tax change that? if those who feel very strongly about it leave the country then iimv the country is all the better for it


and how are these sophists getting away with confusing their own income with a rate of return from an investment ...these are not the 'bedrock' of british business these are the greedy bastards who have been ruining british business for decades ... please let them all go to Dubai .....

check here

[ahinton]

er yep if you earn a lot and are honest with no dodges you will end up paying some 50-60 % of annual incomes to HRMC according to ah calcs

when other capitalists are bragging about the uk it is our low tax and non dom rules that account for all those foreign millionaires spending fortunes in Harrods, mayfair car showrooms and keeping Phillipino slaves

The non-dom rules have been tightened quite abit in recent times, although there can never be any way around some advantage-taking using this means.

[amateur51]

I wanted to mention somewhere the death of PC David Rathband. I thought it was terribly sad news. It really goes to show how the odds can be stacked against some people through no fault of their own.

http://www.bbc.co.uk/news/uk-england-tyne-17217080.

I hesitate to make a political point. There is a risk of seeming to make capital out of it. At the same time, it seems right to see if there are any lessons that can be learned. That in many ways is a tribute to someone's life. This was a man who at 44 had lost his eyesight, his job, his marriage and his family. I would think that the circumstances of his most terrible injury were such that money was not a problem. Still, the psychological impacts proved overwhelming. While his situation was complex - both the incident that led to his injury and all the subsequent press attention - it made me wonder how many people there are alive who have also lost their eyesight, job, marriage and family. There are probably more than we think.

Cameron today spoke of his bravery. I don't know if he would feel that others in a similarly unfortunate position should work if they are not well off or else have their allowances reviewed. PC Rathband devoted considerable time to charity work but arguably that time for him would have been better spent on counselling. It might just have saved his life.

I found this blog piece an interesting adjunct to your piece, Lat

http://mentalhealthcop.wordpress.com/2012/02/21/who-is-protecting-the-protectors/?CMP=EMCSOCEML657

[handsomefortune]

they can't all go to Dubai or "Asia", and the "brain-drain" theory does depend on people in Dubai or "Asia" sharing the high opinion that the 'brain-drainers' and their panic button presser mates in the press have of themselves


:ok: exactly john skelton!

'brainy' financial predators don't usually seem quite so 'brainy' in an environment where they look wimpish in comparison to direct competition as in dubai. even the most hardened individuals aren't used to domestic servants casually being beaten to death in the street, without a second thought, as reported can happen in dubai. whilst there's virtually no risk of getting prosecuted in this situation, for 'brainy' people ....they might worry (a bit) that the cheapness of some human life might emphasise that they themselves are easily expendable ...if there's enough money to be made for a competitor. which is precisely why they stay here, ponce about in porches etc avoiding most rules, which they figure don't apply to them..... just to others, prefering no direct competition.

i do hope the promotional gloss on dubai stays however - the more that push off the better!

[aka Calum Da Jazbo]

http://press.princeton.edu/images/j9128.gif

well worth reading when it comes to superstar bankers or did i misspell?

and an assessment of taxation's economic impact in USA .... presumably very similar to here since it is principles we are arguing about

225 million people worldwide are unemployed
1 in 3 people on the planet are poor or unemployed
1% of the world's families own 40% of the wealth
Wages as a percent of GDP are at an all-time low
Corporate profits as a percent of GDP are at an all-time high

Read more: http://www.businessinsider.com/the-s...#ixzz1nxsAqRf4

[John Skelton]

but most of those who would not do this would instead resort to more - and more comprehensive - tax planning exercises in order to ensure as much control over their overall tax liabilities as possible.

Resort to? The poor, suffering, bled dry creatures that they are :smiley:. They "resort" to such "exercises" anyway - I don't think it follows that there's a threshold at which 'they' would say 'stuff this. I don't mind paying tax at x % but this is taking the etc.' It's what people like that do: 'tax plan'. Whatever the rate of taxation.

That's because they are greedy.

The other problem, of course, is that some people also feel profoundly aggrieved at the ways in which their tax payments are mismanaged and ill-advisedly spent ....

You mean the NHS, the Welfare State, State Education? Yes, I can see that paying for things the rich have no need of must get their backs up. On the other hand they are probably keen to have a police force etc. in place to protect their property / assets.

[ahinton]

Resort to? The poor, suffering, bled dry creatures that they are :smiley:. They "resort" to such "exercises" anyway - I don't think it follows that there's a threshold at which 'they' would say 'stuff this. I don't mind paying tax at x % but this is taking the etc.' It's what people like that do: 'tax plan'. Whatever the rate of taxation.

Whilst I have no doubt that there are indeed some people who would try to get of of paying every penny of tax, there are far more who dont mind paying what they see as a fair amount but resent being expectged to pay anexcessive amount and therefore don't do so.

You mean the NHS, the Welfare State, State Education? Yes, I can see that paying for things the rich have no need of must get their backs up. On the other hand they are probably keen to have a police force etc. in place to protect their property / assets.

Not at all. The rich need NHS just like everone else; they might need it somewhat less often but, for example, rich people are not exempt from having accidents that may require the services of A&E and you can't get those privately. Not every rich person with children has them privately educated, either. That said, I was referring to the mismanagement of taxes paid, the excessive costs of tax inspection and collection which could be trimmed substantially by simplifications to the tax system (not least the abolition of NIC as some kind of separate tax on incomes), the wastage on defence procurement failures and unnecessary wars and the like, all of which poorer people cannot afford to fund either.