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

[teamsaint]

working out peoples "dues" also involves working out what they are putting in , and getting out of the state now.

Because of our complex tax and benefits system, its hard to know what the start point is.

Some things we can say, or have a stab at. In developed economies (the ones where we create endless toxic waste!) there has been a general consensus that overall government spending of about 40% of GDP seems to be workable. Starting from there, (if we accept it, and not everybody does) we can then start to have a stab at what our dues might be, given our place on the income scale.

[Lateralthinking1]

ahinton - You have attributed some of hf's comments to me (number 225). I say that not as a criticism but to clarify. However, thank you for taking the time and trouble to comment on mine too (number 224). I have read your comments in full. I agree that there is a reasonable amount of common ground in the outlook if not on many of the specifics. I could put forward an argument to counter one of yours on the public sector but I have said as much as I want to say for now - Lat.

[ahinton]

ahinton - You have attributed some of hf's comments to me (number 225). I say that not as a criticism but to clarify.

Have I really? I'm not sure how that would have ome about in a post where my responses were to quotes from you, but if you'd care to confirm what these are, I'll accept what you tell me and apologise duly.

However, thank you for taking the time and trouble to comment on mine too (number 224). I have read your comments in full. I agree that there is a reasonable amount of common ground in the outlook if not on many of the specifics. I could put forward an argument to counter one of yours on the public sector but I have said as much as I want to say for now - Lat.

You're very welcome. I just write as best I can about what I think and respond to the comments of others, again as best I can. None of us knows the "right" answers to any of these things, largely because there aren't any - but that fact most fortunately doesn't and indeed cannot preclude any of us from developing and expressing our views.

[Lateralthinking1]

ahinton - I think 224 are mine and 225 are hf's. Not a problem. We often seem to agree. But as you say, none of us can know for sure. Thanks again for your considered words.

[Beef Oven]

have to disagree with Beefoven here.
the complexity in our system really has nothing to do with the number of tax bands......in the computer age that is not even vaguely a problem.

Complexity lies elsewhere.The idea of a single flat rate is inherenly unfair if you believe that the more you have , the more you should porportionately pay. i really don't see why people on £1m a year should pay the same marginal rate as those on £15k.

I would keep the bands,amalgamated with NIC and have several, maybe 10 p , 20 p 30p 40 p and perhaps 50 p and higher.The rich have to pay. Most of the very rich aren't "earning " their money in any sense that most people would understand it.

Teamsaint, disagree with me if you have to, by all means.

I'm not actually interested in complexity, it's a non-issue for me.

I support a flat-rate 25% income tax, coupled with a £12k free-pay threshold because I am interested in a tax structure that is fundamentally fair, motivates people to achieve, protects low-earners and encourages economic growth.

For example, a worker being paid twice the minimum hourly wage rate on a 40 hour week (circa £26k per annum) would pay £3,500 in tax per annum, 13% of their earnings. By contrast, a fat-cat public sector Director on £112K, would pay £25,000 in tax per annum - 22% of their earnings. Therefore, a flat rate means that not only do you pay more tax the more you earn, it also means that higher earners will pay tax on a greater proportion of their earnings than lower earners will - a very socialist principle!

This would mean that the more you earn, the more tax you pay - very progressive, just as it should be.

People who have a touch of the 'tall poppies' syndrome, or who are from the politics of envy school of thought, will call for higher earners to pay disproportionately higher taxes. I just can't see their justification for this.

I would also reduce the NI burden on employers to encourage new hires.

We'll probably need to agree to disagree. :winkeye:

[teamsaint]

well Beefoven, I agree with you on increased thresholds, generally lower rates, motivation and economic growth.
As for the politics of envy.......this useless phrase is a stick for the haves to beat the have nots in my opinion !!

however, since tax will never be truly fair, i see no problem at all in higher rates being applied to the best off. Marginal rates do matter.

However, a proper wealth tax might do this just as well.
In any case the vast, and rapidly increasing differences in income in our society need dealing with. This is a real and urgent issue. Having a cabinet stuffed with people who inherited multi million pound fortunes isn't helping address this divisive situation !
If this is the politics of envy, then so be it !!

[teamsaint]

http://www.bbc.co.uk/news/uk-england-17208177

I expect some of these people suffer from the politics of envy !!

Wouldn't be a suprise really. Hard to really know how dave and george can empathise. Perhaps they pay someone to do it for them.

[ahinton]

As for the politics of envy.......this useless phrase is a stick for the haves to beat the have nots in my opinion !!

Then why is one of those have nots wielding it?(!)

however, since tax will never be truly fair, i see no problem at all in higher rates being applied to the best off. Marginal rates do matter.

You'd just written that you agree with another member about increased thresholds and generally lower rates; the better off don't even have a starting threshold in any case! There seems to be some inconsistency here (unless I am missing something). Introducing too many higher rates costs money and causes confusion; if the highest rate of income tax was, say, 35% and the starting threshold for that was, say, £30,000 p.a., why shouldn't someone on £500,000 p.a. pay it like everyone else with an income in excess of £30,000 p.a.? The more taxable income the taxpayer receives, the more tax he/she pays at that rate; what's so wrong about that? If, only the other hand, still higher rates for those on very high incomes is to be advocated, we really are entering the politics of envy/jealousy territory that's based on the idea that we don't like the amount of income someone has so we'll tax it at a higher rate than everyone else's; if, for example, a rate of, say, 70% were to be levied on all incomes over £1M p.a., wouldn't you say that there wold be a case for levying, say, 80% on incomes over, say, £2.5M p.a. or 90% on those in excess of £5M p.a.? Where would it stop?

However, a proper wealth tax might do this just as well.

It simply wouldn't work. Have a look at all the exceptions and exemptions offered by the French on theirs (and, heaven knows, the French are past masters at charging taxes!) - and that's before any widely advertised legitimate get-outs are used by the taxpayer. One reason why it wouldn't work is that those of sufficient means to be assessed for it would be in a far better position than most of us to set up their domiciliary arrangments so as to enable them to decide in which country they pay tax (most people pay tax in only one country and most countries have strict rules and some also have reciprocal arrangements covering this kind of thing).

As to the much-vaunted notion of "fairness", just look at the vast differences between French wealth tax and Spanish ditto; which is the "fairer" of these? Should wealthy Spanish citiens have to pay far more wealth tax than their French counterparts?

In any case the vast, and rapidly increasing differences in income in our society need dealing with. This is a real and urgent issue.

But how and why? Apart from those who depend principally on inherited wealth to provide most or all of their incomes, people's incomes are dependent upon the amounts that those who pay them are prepared to pay them; trying to do anything about what you call "the vast, and rapidly increasing differences in income in our society" by increasing taxes for those on higher incomes seems to me rather like locking the stable door after the cart before the horse has bolted (if you'll excuise the mixed metaphor). If you really wish to adopt a moralistic stance on this, shouldn't your first port of call be the payers rather than the recipients? After all, most people's incomes derive from a relatively small numer of sources and very few income millionaires receive small amounts from thousands of sources.

Having a cabinet stuffed with people who inherited multi million pound fortunes isn't helping address this divisive situation !

For one thing, it isn't so stuffed. Yes, there are a few examples, many of them high profile ones such as the PM and his deputy and CoE, but the majority of those in government have not inherited such fortunes - and MPs don't exactly seek election so that they can derive massive incomes from being MPs! Furthermore, every MP is elected by his/her constituents so, again, rather like the payers v. recipients argument above, shouldn't your first target be the electorate rather than the elected, perhaps in the form of a campaign to discourage or even disqualify anyone from standing for office if their inherited wealth is known to exceed a certain figure? In any case, having inherited wealth, earned wealth or both is no excuse for lack of compassion and understanding, whether or not those wealthy are MPs - and especially if they're PM, deputy PM or CoE!

[Beef Oven]

http://www.bbc.co.uk/news/uk-england-17208177

I expect some of these people suffer from the politics of envy !!

Wouldn't be a suprise really. Hard to really know how dave and george can empathise. Perhaps they pay someone to do it for them.

Teamsaint, this film is a useful reminder as to why we need to motivate people to achieve and create jobs, industry and wealth. We need to get behind our entrepreneurs and dynamic people, not stifle them with the politics of envy.

[teamsaint]

Regarding income tax rates......they are arbitrary. End of. I don't have a problem charging those at the top proportionately more......and in any case the principle, good or bad, is well established by governments of all types.I agree with Beefoven about lower rates generally, but I don't have a problem with differing rates, whereas he is in favour of a flat rate.

Wealth taxes. I agree that they might be very difficult to do well or fairly........but that's no reason not to try.

Huge and increasing gaps in income levels need addressing because they lead (according to any research I have ever seen) to unhappier societies. And much wealth is gained at the direct expense of others.(you know, bankers, landowners, exploitive bosses, that sort of thing).
How? well tax would be a place to start, including on wealth(difficult though that is).

As regards fairness in taxation, i have said often that it will never be completely fair, but again, no reason that fairness shouldn't be the aim.

The problem with your final suggestion is that the cabinet just reflect a society where the balance is all one way. Politics, business, the media are all in the hands of a wealthy group, who have no intention of allowing their power to be undermined.It would seem utter madness that we continue to elect people like Cameron who cannot possibly represent the interests of most people......but those are the options we are given.(Check out the increase in wealth inequality under labour !!)
We can "blame the victim"(the voters) if you want....but that doesn't mean taking the blame away from the the people running the show in their own interests.
Got to go.....stuff to sell !!
Have a nice day all !!

[aeolium]

I think the 'politics of envy' argument is largely one deployed by those justifying the possession of great wealth or great income, as it has been used at least since the early C20 by for instance landed aristocrats (whose lands had for the most part been acquired through seizure in earlier centuries). It is a false argument as it presumes that those opposed to the possession of great wealth/income do so on the basis that they don't have it but would like to. But it's quite possible to argue that such possession is wrong without coveting the lifestyle of Fred Goodwin: for instance, on the grounds that great inequality in society is very bad for the society, that societies in which there is a more equitable distribution of wealth are better societies - quite a lot of evidence has been assembled, for instance in The Spirit Level, to show that this is the case. To have people earning millions a year and by dint of various tax avoidance schemes paying as little as a proportion of their income as those on modest incomes is wrong. It's also wrong to have great wealth as an incentive or an objective, to portray the possession of multiple properties all over the world, yachts, luxury cars, private planes etc as desirable when the sustainability of the planet requires a huge reduction in consumption (at least in the developed world). It's crazy that the world permits the existence of tax havens where wealthy individuals and corporations can deliberately avoid paying the tax due in the societies that reward them.

In the last 30 years or so, since the rise of Thatcherism and Reagonomics, and at least up to the financial crash of 2008, powerful interests in politics, the media and business have persuaded governments - and to some extent societies - that low tax was a good thing. The result has been a huge increase in inequality in both the developed and the developing world, and a concentration of enormous wealth in quite a narrow elite of individuals and multinational corporations. That has been accompanied by an increase in poverty (including child poverty) and since the financial crash an intensification of that poverty accompanied by the relative impoverishment of much of the middle class, particularly among the young. It is the crash which has prompted the reaction against that free-market fundamentalism, not least since all classes except the very rich have suffered.

[Beef Oven]

Regarding income tax rates......they are arbitrary. End of. I don't have a problem charging those at the top proportionately more......and in any case the principle, good or bad, is well established by governments of all types.I agree with Beefoven about lower rates generally, but I don't have a problem with differing rates, whereas he is in favour of a flat rate.

Wealth taxes. I agree that they might be very difficult to do well or fairly........but that's no reason not to try.

Huge and increasing gaps in income levels need addressing because they lead (according to any research I have ever seen) to unhappier societies. And much wealth is gained at the direct expense of others.(you know, bankers, landowners, exploitive bosses, that sort of thing).
How? well tax would be a place to start, including on wealth(difficult though that is).

As regards fairness in taxation, i have said often that it will never be completely fair, but again, no reason that fairness shouldn't be the aim.

The problem with your final suggestion is that the cabinet just reflect a society where the balance is all one way. Politics, business, the media are all in the hands of a wealthy group, who have no intention of allowing their power to be undermined.It would seem utter madness that we continue to elect people like Cameron who cannot possibly represent the interests of most people......but those are the options we are given.(Check out the increase in wealth inequality under labour !!)
We can "blame the victim"(the voters) if you want....but that doesn't mean taking the blame away from the the people running the show in their own interests.
Got to go.....stuff to sell !!
Have a nice day all !!

Teamsaint, make sure that you are selling at a healthy profit - Britain needs people like you!! Have a nice day too. :winkeye:

[ahinton]

Regarding income tax rates......they are arbitrary. End of. I don't have a problem charging those at the top proportionately more......and in any case the principle, good or bad, is well established by governments of all types.I agree with Beefoven about lower rates generally, but I don't have a problem with differing rates, whereas he is in favour of a flat rate.

You may not have a problem with that, but then I don't have a problem with setting a top rate of income tax and leaving it at that. Whatever the top rate that's set - even if it might seem high enough to suit those who want to tax those on the highest incomes ashighly as possible - that would be the top rate for all income above a certain figure, so if you were to levy 90% on all taxable income over £1m p.a., might that then be seen as inequitable to the extent that the person on £1.1m p.a. has to pay the same as the person on £20m p.a.? The problem here is that there are no upper limits to income levels but there has to be a top rate of income tax.

Wealth taxes. I agree that they might be very difficult to do well or fairly........but that's no reason not to try.

Tax design and implementation costs money more so if the tax is an entirely new one. Research would need to be done in all those countries that levy wealth taxes and conclusions formed about the proportion of tax take in each case, the extent to which the governments concerned offer allowances against them, the extent to which they can be avoided, the rates and thresholds that should be chosen, etc. Ultimately, there will be some who consider them to be unfair whatever thresholds and rates are set, because they involve taxing the same funds more than once.

Huge and increasing gaps in income levels need addressing because they lead (according to any research I have ever seen) to unhappier societies. And much wealth is gained at the direct expense of others.(you know, bankers, landowners, exploitive bosses, that sort of thing).

That's all very well, but almost all incomes and asset acquisitions are at someone else's expense, not just the wealthy taking advantage and the poor being taken advantage of. The extent to which such inequalities make a society unhappier is dependent in lage part upon how much resentment of the haves that the have nots feel. I get a commission so someone else doesn't. I receiuve a royalty so someone else doesn't. And so on.

Again, if income inequalities are to be "sdealt with" in some way, why just approach the recipients? It's the payers that decide how much income they'll have!

Ultimately, if you charge unreasonably high amounts of income, wealth and gains taxes, some people will eventually lose their tolerance and take their wealth elsewhere.

As regards fairness in taxation, i have said often that it will never be completely fair, but again, no reason that fairness shouldn't be the aim.

If you aim for anything you should at least have some idea at the outset as to how to achieve that aim; if it will never be completely fair, you'd be aiming at a permanently moving target.

The problem with your final suggestion is that the cabinet just reflect a society where the balance is all one way. Politics, business, the media are all in the hands of a wealthy group, who have no intention of allowing their power to be undermined.It would seem utter madness that we continue to elect people like Cameron who cannot possibly represent the interests of most people......but those are the options we are given.(Check out the increase in wealth inequality under labour !!)

But we DO elect these people! We don't have to Even if every candidate in a constituency at a General Election were to be deemed to possess an excessive amount in inherited wealth, it is not an offence to withhold one's vote. What would you do about this?

We can "blame the victim"(the voters) if you want....but that doesn't mean taking the blame away from the the people running the show in their own interests.

But most of them don't do that - and those that have vast sums already have even less need to do it.

In the end, I'm more concerned about economic poverty than about economic inequalities.

[aka Calum Da Jazbo]

i am with Vince on property

and Zoe on history

i have always thought the phrase 'the politics of envy' as a master lie on a par with Goebbels's .... envy implies that an agent desires what another agent possesses ..... the poor do not protest that the money in the rich man's wallet should be in theirs .... they protest the life of exclusion and suppression they live as a condition of the money existing at all and its location in the fat bastard's purse

there are too many overweight and expensively clothed critics of the life styles of the poor [baloney really ..... let these greasy republicans in the USA neocon club or the squires and masons in Cameron's set live with the choice constraints of the poor for five years and see what they are made of]


the more this thread continues the more i am inclined to argue that there is no "we"; the "it" is a confidence trick or at least a major act of mendacity; and that "together" is pure adspeak ..... a phantasm of aspiration and nationalism that has no referent in our life or future ... for sure the bankers and the Cameron Set do not foresee a future in which 'we' are 'together' ... eh?

[aka Calum Da Jazbo]

er not so sure on Vince's pals as this is a view of the impact of raising allownces in cash terms

http://www.ifs.org.uk/images/obs/income_deciles2.gif

from here