Taxing the rich to pay for the poor

Elegran

First define "the rich" and "the poor" and differentiate them from "hard-working executives" and "vulnerable people and those unable to earn"

If it is described and operated as taxing the rich to fund giving the poor the health, education and confidence to allow them to bring out their best talents (thus contributing to the community as well as to their own bank balances and well-being) it is something that the whole country can support.

If it comes over as taxing them out of spite because "the poor" resent that they are confident and successful, then "the rich" will dig their heels in and refuse to support the policy. they will hide their wealth in foreign tax-havens or take it with them to spend in countries without fiscal policies that they believe target them unfairly.

I agree and I’m not Tory, but as I’ve not read Labour’s entire manifesto I’m saving comment and judgement until it is published.

I don’t subscribe to the assertion that all parties other than Reform and Conservative are “Politics of Envy”.

Most of us, imo, have the utmost respect for people who’ve done well at work, especially those who come from average backgrounds, who pay their taxes, who do their “bit” in their community and who are honest, hard working people.

I know people, and have good friends, who fall squarely in the above category and have differing political views.

Don’t wish to see our welfare benefits decrease but I would like to see those who can work, working, if there are suitable jobs within a sensible travelling distant. If there are not “suitable jobs” then find decent training schemes leading to employment and if people refuse to participate without a very good reason, then penalise.

I’d like to see those who will never be able to work again receive enough money to “live”, rather than just survive, I’d like to see those who cannot work right now, but with the right support would be able to return to work in the future better supported.

So much is wrong currently, it’s hard to know where to begin, but getting as many “able” people into sustainable, properly paid, long term work is a good start, then overhaul the NHS, fund education properly and build aspiration within vulnerable families and we might just start to move forward in a more positive way.

Germanshepherdsmum

What I find very sad, nadateturbe, is the suffering of animals who have no voice and no means of escape from cruelty and neglect. They are the sentient beings that I support, in this country and elsewhere in the world, and always will. I make no apology for preferring to give financial support to charities which work to improve the conditions of animals worldwide rather than people in this country, many of whom could well improve their lot in life if they were willing to put in the effort.

Someone has to support these poor animals x

Germanshepherdsmum

Good, growstuff. Nor do I. I expect many do, without considering that they are probably contributing to tax evasion. There is no good reason why someone working for you should not give you their bank details so you can pay them online. Some may be able to take payment by card but that entails taking a hit from the card company. Vast amounts of income go untraced through the cash economy, and how do you know that the person to whom you pay cash is not only putting it under the mattress but also claiming benefits?

👏👏👏👏👏

It’s not just cash that can evade tax, there are plenty of other ways for everyday spending does not get declared or VAT is “lost” along the way. It’s very difficult to catch those that are determined to be fraudulent from the start.

Yes, how many tradesmen offer a lower price (no VAT) for cash? Obviously that would involve both income tax and VAT evasion. I would be surprised if most of us haven’t had such an offer, and I hope nobody has accepted it (or done business with that tradesman again).

In the late 60s my Mum rented out Gran’s bungalow after she died, until she felt ready to sell it. She paid someone to do some work on it and then claimed the cost against tax on the rent. Cue a very nasty call from the tradesman who had not declared the income and the Inland Revenue (as it was then) had caught up with him. Serve him right.

I disagree with anyone not paying their dues to society but dishonest people are spread across the whole of our society. How much did Zahawi fail to declare? Oh over 5 million pounds! How much did Mone make supplying rubbish PPE as a result of her connections with people in government? 29 million! How much did the Greensill failure cost the taxpayer? Oh 5bn and Cameron was lobbying on his behalf. Let's not overlook the dishonest greedy graspers who are making millions out of the tax payer, not by fiddling their benefits or being paid cash in hand but by being close to the seat of power.

growstuff

Norah

Elegran

Norah quoted - "in Wandsworth, half of all PAYE earners earned less than £43,620 gross."

Norah replied - "I gather that means half earn more than that? So, if their partner even close to similarly earns, depending on outgoings, they could save."

"I find it ludicrous to believe nobody but the very wealthy can save." Norah

The half earning more than £43,620 gross were probably aged 45 or over.

Age / Weekly Wage (median) Full time gross pay / Annual salary*
18-21 / £441/ £22,932
22-29 / £583 / £30,316
30-38 / £722 / £37,544
40-49 / £770 / £40,040
50-59 / £727 / £37,804
60+ / £651 / £33,852
( www.forbes.com/uk/advisor/business/average-uk-salary-by-age/ )

In www.expatistan.com/cost-of-living/country/united-kingdom , a summary of living costs per month is given, these equate annually to £52,368 for a family of four, and £30,036 for a single person.

So the income of the average person between 18 and 21 is about £700 short of their expenses – so they are probably living at home, and eating the groceries bought by their mother.

Someone between 22 and 29 is spending right up to his/her income on living independently.

Between 30 and 49 is the peak time for producing and raising a family – a costly period in both money and in time. After that average salary reduces, though children (and later grandchildren) don't suddenly stop needing help – those average 18 to 21 year-olds are not yet fully independent.

Someone with a working partner, between 22 and 29 using your sums, would have money to spare - if I understand you.

Seems reasonable to me.

Looks to me working people with working partners, between 30 and 49 would be financially ok to produce and raise a family and save, correct?

That's in Wandsworth, which has the highest median pay. Everywhere else has less. You have also forgotten that is gross pay before income tax and NI deductions (and student loans repayments for many).

Now deduct rent/mortgage repayments, which are likely to be over £1000 a month, Council Tax, utilities and travel to/from work and food. There won't be much left.

Working people with working partners between 30 and 49 are also likely to have childcare costs.

You're living in lalaland if you think they're financially OK.

I know you used Wandsworth as your data point. Thank you for reminding me. I didn't forget it was gross pay. I allowed people have outgoings.

My point was 1/2 the working couples, 30 and older, likely are able to save. I find it ludicrous to think a family with that income can't save in ISAs.

Pertinent -- ISAs are a good method of saving for many people.

Elegran

Norah "Looks to me working people with working partners, between 30 and 49 would be financially ok to produce and raise a family and save, correct?"

You would have to ask a wide variety people of that age to be certain of the answer, in any specific case, as you would of people between 22 and 29 with a working partner and children It depends on how much that particular couple is earning - an average means that there are people earning more than that and less than that. Many women with families work part time, as childcare full time can absorb a large chunk of their wages.

The "average" person could be doing OK, while under the "average" graph line are others who are not.

Precisely. Half the people are above the average, half are not.

I didn't write the ONS stats, but understand. Half of the people in this country are above the average - and likely want a way as ISAs to save.

Germanshepherdsmum

What are you suggesting GrannyRose?

If I had my way everyone would pay the same income tax rate. 20% of £90000 is twice as much tax as 20% of £45000. You don’t need different tax rates to ensure those with higher earnings pay more tax.

I don’t think you should apply to be the next Chancellor, though I’m sure high earners would be delighted to only pay 20% tax.

Foxie48 👍

I’d love the job of chancellor. I have some brilliant plans for tax reform. And for the NHS, Education, reform of the House of Lords, housing policy. The trouble is no one will listen.

GrannyRose15

I’d love the job of chancellor. I have some brilliant plans for tax reform. And for the NHS, Education, reform of the House of Lords, housing policy. The trouble is no one will listen.

Listen to the Leaders podcast with RS and AC talking to Rachel Reeves.

She is scarily impressive.

You might not agree with her economic stance but blimey she knows her own mind and has an imposing CV.

Do you realise how much tax revenue your brilliant plan would lose the Treasury GrannyRose? How would you make up the massive shortfall?

Sago

We have friends that are poised to leave if Labour get in.
Our daughter,SIL and grandchildren will also be very likely to leave.
The people they employ in the home and garden, local dry cleaners, car valeters, butchers, fishmongers, restaurants, tailors etc will all suffer as a result.
The money wealthy people put into the local economy needs to be taken into account.

Oh! If they are good at their jobs then surely they soon find new employment?

Where will your family be moving ?

Germanshepherdsmum

Yes, how many tradesmen offer a lower price (no VAT) for cash? Obviously that would involve both income tax and VAT evasion. I would be surprised if most of us haven’t had such an offer, and I hope nobody has accepted it (or done business with that tradesman again).

Never!

Germanshepherdsmum

Do you realise how much tax revenue your brilliant plan would lose the Treasury GrannyRose? How would you make up the massive shortfall?

That’s exactly my thought!

Norah

Elegran

Norah "Looks to me working people with working partners, between 30 and 49 would be financially ok to produce and raise a family and save, correct?"

You would have to ask a wide variety people of that age to be certain of the answer, in any specific case, as you would of people between 22 and 29 with a working partner and children It depends on how much that particular couple is earning - an average means that there are people earning more than that and less than that. Many women with families work part time, as childcare full time can absorb a large chunk of their wages.

The "average" person could be doing OK, while under the "average" graph line are others who are not.

Precisely. Half the people are above the average, half are not.

I didn't write the ONS stats, but understand. Half of the people in this country are above the average - and likely want a way as ISAs to save.

I agree that ISAs are a good way for people with middle incomes to save, if they would otherwise pay tax on interest. What I'm disputing is that they are a good for people on low incomes because they probably don't have anything left over to save - almost certainly not enough to be earning more than £1000 a year in interest. Look at the figures and do some maths.

Norah

growstuff

Norah

Elegran

Norah quoted - "in Wandsworth, half of all PAYE earners earned less than £43,620 gross."

Norah replied - "I gather that means half earn more than that? So, if their partner even close to similarly earns, depending on outgoings, they could save."

"I find it ludicrous to believe nobody but the very wealthy can save." Norah

The half earning more than £43,620 gross were probably aged 45 or over.

Age / Weekly Wage (median) Full time gross pay / Annual salary*
18-21 / £441/ £22,932
22-29 / £583 / £30,316
30-38 / £722 / £37,544
40-49 / £770 / £40,040
50-59 / £727 / £37,804
60+ / £651 / £33,852
( www.forbes.com/uk/advisor/business/average-uk-salary-by-age/ )

In www.expatistan.com/cost-of-living/country/united-kingdom , a summary of living costs per month is given, these equate annually to £52,368 for a family of four, and £30,036 for a single person.

So the income of the average person between 18 and 21 is about £700 short of their expenses – so they are probably living at home, and eating the groceries bought by their mother.

Someone between 22 and 29 is spending right up to his/her income on living independently.

Between 30 and 49 is the peak time for producing and raising a family – a costly period in both money and in time. After that average salary reduces, though children (and later grandchildren) don't suddenly stop needing help – those average 18 to 21 year-olds are not yet fully independent.

Someone with a working partner, between 22 and 29 using your sums, would have money to spare - if I understand you.

Seems reasonable to me.

Looks to me working people with working partners, between 30 and 49 would be financially ok to produce and raise a family and save, correct?

That's in Wandsworth, which has the highest median pay. Everywhere else has less. You have also forgotten that is gross pay before income tax and NI deductions (and student loans repayments for many).

Now deduct rent/mortgage repayments, which are likely to be over £1000 a month, Council Tax, utilities and travel to/from work and food. There won't be much left.

Working people with working partners between 30 and 49 are also likely to have childcare costs.

You're living in lalaland if you think they're financially OK.

I know you used Wandsworth as your data point. Thank you for reminding me. I didn't forget it was gross pay. I allowed people have outgoings.

My point was 1/2 the working couples, 30 and older, likely are able to save. I find it ludicrous to think a family with that income can't save in ISAs.

Pertinent -- ISAs are a good method of saving for many people.

Only if they don't have children and have to pay for childcare, which can easily be in the region of £1000 a month for each child.

GrannyRose15

Germanshepherdsmum

What are you suggesting GrannyRose?

If I had my way everyone would pay the same income tax rate. 20% of £90000 is twice as much tax as 20% of £45000. You don’t need different tax rates to ensure those with higher earnings pay more tax.

But the poor already pay more as a percentage of their income in tax, because indirect taxation takes a larger share of their income.
So what you are proposing is that the poor should pay more still and the rich should pay even less.
The UK tax system is incredibly unfair. The very high levels of indirect taxes, like VAT and the peculiarities of the Council Tax system mean that the poorest 10% of the population pay about 11% more in tax than the rest of the population.

citizen-network.org/library/graphic-poor-pay-the-most-tax.html#:~:text=The%20very%20high%20levels%20of,the%20rest%20of%20the%20population.

Norah

Elegran

Norah "Looks to me working people with working partners, between 30 and 49 would be financially ok to produce and raise a family and save, correct?"

You would have to ask a wide variety people of that age to be certain of the answer, in any specific case, as you would of people between 22 and 29 with a working partner and children It depends on how much that particular couple is earning - an average means that there are people earning more than that and less than that. Many women with families work part time, as childcare full time can absorb a large chunk of their wages.

The "average" person could be doing OK, while under the "average" graph line are others who are not.

Precisely. Half the people are above the average, half are not.

I didn't write the ONS stats, but understand. Half of the people in this country are above the average - and likely want a way as ISAs to save.

What about the other half? Don't they matter?

Cossy I agree with every word you wrote @ 11.56.

growstuff

Cossy I agree with every word you wrote @ 11.56.

So do I - it's knowing where to start and having a government with the courage to slaughter sacred cows that present the difficulties.

Some people don’t understand statistics. Averages aren’t the middle - that’s the median. Average income are all incomes added up divided by the number of people - it doesn’t necessarily divide into equal halves above/ below. A simple example most people have 2 legs , a few people have one leg, and a few no legs, so the average number of legs is less than 2, but far more people have 2 legs than those with fewer than 2., they aren’t equal categories. I’m not sure if I’ve explained that very well but those who say half are above average, half below are wrong.