So, who votes for a government that improves the lives of Bankers, and ensures the excessive profits of energy companies, but needs all the "levelling up" money to pay for the holes in Brexit?

volver

I find it really quite disconcerting that people are so money-obsessed that they think the only principle driving others is financial jealousy.

The way you measure yourself is how you measure others, and how you assume others measure you. It's why you are surprised and even upset when someone behaves so far from how you would and why you believe others judge life by the same standard you do.

How a person judges you or suggests how someone else might be thinking gives a great deal of insight into how they think.

Whether they find the UK attractive depends very much on what products or services they supply, and where they intend to make the supply.

No, I don’t approve of a low wage economy but that’s not what I have been talking about.

We need to attract investment and the right people in order to grow.

And how are businesses going to find investing in the UK attractive when a large section of the population can't afford to buy their products or services?

Or will they find the UK attractive because they can pay very low wages and sell their products abroad? Do you approve of a low wage economy?

I have used an accountant to deal with my tax affairs for many years Doodledog, paid a lot of tax and never indulged in any schemes to pay less. However, a significant increase in the higher rate of tax, or any other tax, would be damaging to the economy. We need to attract investment and the right people in order to grow. It has been demonstrated that increasing for instance income tax rates does not result in a corresponding increase in tax receipts because that simply encourages avoidance schemes.

I earned a lot as a City lawyer but didn’t find that unconscionable. I don’t use the word ‘earned’ lightly. I took nothing away from anyone but contributed, and continue to contribute, plenty in both taxes and charitable donations. Yes, workers in some, primarily public, sectors should be paid more but how is being an ‘unconscionably’ high earner in the private sector detrimental to them?

So the payment of excessive bonuses doesn't affect the general public in any way?

Perhaps, GSM and Prentice, you could tell me how banks actually make the profits from which they pay the bonuses.

Just where does that money come from?

Well said Doodledog.

Prentice

Redistribution how and where?
banks and companies should feel free to award what they like to employees.
it is an optics only matter. People feel aggrieved when others make large sums of cash.

No, that is not true. Some may, but people like me feel aggrieved when others pay comparatively little tax, so there is less to go into public services to help those who work equally hard but earn less. We are always being told that we cannot afford things like decent pensions, social care or the NHS, yet if we had a progressive tax system that was rigorously enforced there would be a lot more money to go around, and decent services could be made available to all.

It is unconscionable that people who work are forced onto Universal Credit and rely on food banks when others 'earn' more in a bonus payment than they do in years. It is shameful that many people are unable to afford decent care after a lifetime of paying into an NI system, and it is wrong that that system is capped so that high earners pay a lower percentage than those on lower incomes, and that some workers earn so little that they pay nothing at all, and are thus excluded from pension and sick pay contributions (as, of course, are their employers). Meanwhile, bonuses are not included in these contributions, as bankers earn far more than the maximum for NI payments, and many will employ accountants and FAs to ensure the their tax bills are kept as low as legally possible. That grieves me, as (IMO) it should grieve anyone who cares about social justice.

Prentice

Germanshepherdsmum

I have already said on another thread that removing the cap on bankers’ bonuses is a good move.

The economy relies heavily on financial services and it’s vital that our banks are able to compete with, for instance, US banks which do not cap bonuses.

Furthermore, the tax paid by recipients of bonuses will be far higher than the banks would have paid had the money been retained.

I did not understand this situation t until I heard it explained clearly on radio 4 just yesterday.
It will continue to be misunderstood though and people will feel angry, even though it will not affect them at all.
after the Queen's funeral is over I really do think that Liz Truss and the Chancellor need to appear on tv and explain the financial package of help with energy, the banker's bonus issue and anything else that needs the public understanding.

Could you pass on the understanding you gained Prentice or tell us the programme/give a link. I think many will be interested to get an "outside" view.

How does removing the cap on bankers’ bonuses result in anyone ‘having more at the price of others having little or none’, Daisy?

It’s a vital area for our economy Daisy. This ‘leg up’ is costing us nothing (well, as a bank shareholder it might possibly cost me but I am not complaining, I’m looking at the bigger picture). Prentice is absolutely correct - it’s an optics matter. Nobody but their employers is giving the bankers anything.

Germanshepherdsmum

Farzanah

This is a really crass idea to even contemplate when so many in the country are going to suffer real economic hardship this year.
It’s a vote winner for sure ?.
It’s all been said about trickle down economics, and wage rises for the “serfs” but I would have loved double my salary as an annual extra, even if capped when I worked in the health service. There’d be no shortage of staff that’s for sure.
Why can’t we reward people financially according to their benefit to society?

‘We’ aren’t rewarding bankers, their employers are. Don’t you think that boosting our financial services industry, vital to the economy, and at the same time raking in a lot more tax, is a good idea?

You need to look beyond envy of bankers’ bonuses to see the benefits to the economy of this move.

Don’t kick those who chose a different, more financially rewarding, career. They pay one hell of a lot of tax.

It is not the "envy of bankers' bonuses", that you so excoriatingly suggest, that is the problem.

It is the concern that this government only act on behalf of one part of the population and a very small one at that.

There will be nothing to gain for the majority by this move. I have no objection to some having more. I do object to them having more at the price of others having little or none.

I’m not in envy of bankers bonuses but am not going to apologise for having a social conscience.

What short memories we seem to have. The 2008 banking crash isn’t that long ago, when, briefly, deregulated banks expanded into more stock and bond trading, boosting profits, and bonuses were reaped in line with profits generated. The moral hazard of bonuses were exposed.

Many in the banking industry (not just bankers) lost their jobs and it sparked the deepest recession since 2nd World War.
Remember it was the taxpayers who had to bail out the banks to enable them to survive.

I find it really quite disconcerting that people are so money-obsessed that they think the only principle driving others is financial jealousy.

Germanshepherdsmum

growstuff

karmalady

Germanshepherdsmum

It seems that some posters are unaware of the importance of our financial services industry to our economy.

absolutely. London would not be wealthy without financial services and that would trickle down to everywhere. Many people can only see what is in front of them and don`t have much knowledge about the financial services

Trickle down economics doesn't work. I'd love to know who these "many people" are.

This isn’t only about money trickling down, growstuff, though there would be an element of that. It’s mainly about maintaining a competitive edge for UK financial services, which are vital to the economy, and increasing tax income without raising taxes.

All exports, including Financial Services, have suffered because we left the EU. Is it perhaps the concern of the "mates" that has caused the Government to decide only this area will get a leg up?

Redistribution how and where?
banks and companies should feel free to award what they like to employees.
it is an optics only matter. People feel aggrieved when others make large sums of cash.

It will continue to be misunderstood though and people will feel angry, even though it will not affect them at all.

Of course it affects them, Prentice. This is money that is being sucked out of the domestic economy which could have been available for redistribution.

This is fascinating-how much tax the rich really pay and how much a wealth tax for a limited period would raise www.lse.ac.uk/research/research-for-the-world/economics/how-much-tax-do-the-rich-really-pay

volver

I quite like the idea that MaizieD hinted at.

If you get a million pounds in taxes from one person, you have one very rich person with a Lamborghini.

If you get a million pounds in taxes from 1000 people, you get a self sustaining economy.

But then I'm one of those simpletons who apparently doesn't understand Financial Services. (Despite actually having worked in an FI.)

You probably get more tax in total from the 1,000 people because, having less individually, they will pay more in taxation. as they are more likely to spend all of it. Whereas your Lamborghini guy probably pays a lower percentage on income from investments and squirrels lots away in tax havens...

Germanshepherdsmum

I have already said on another thread that removing the cap on bankers’ bonuses is a good move.

The economy relies heavily on financial services and it’s vital that our banks are able to compete with, for instance, US banks which do not cap bonuses.

Furthermore, the tax paid by recipients of bonuses will be far higher than the banks would have paid had the money been retained.

I did not understand this situation t until I heard it explained clearly on radio 4 just yesterday.
It will continue to be misunderstood though and people will feel angry, even though it will not affect them at all.
after the Queen's funeral is over I really do think that Liz Truss and the Chancellor need to appear on tv and explain the financial package of help with energy, the banker's bonus issue and anything else that needs the public understanding.

Germanshepherdsmum

You have stated several purposes of taxation, Maizie, but nothing about the use of the cash product of taxation.

The use of the taxation could be said to be to pay off the Treasury's overdraft at the BoE. The BoE issues our money into the economy, either directly or by commercial banks under licence from the BoE to issue money (because all 'loans' given by commercial banks are new money). Tax money credited to the Treasury account reduces its debit balance.

There is always a debit balance because not all issued money is spent into the domestic economy, either because of savings, going to tax havens, or purchases from other countries, so it is not all recovered through taxation.

Germanshepherdsmum

But, volver, the employer of the person who pays £1m in taxes is paying that person. What’s the problem there? Contractual master and servant relationship, reward of servant privately negotiated.

I suppose I'm just an old social democrat at heart GSM. I don't think everything should be left to the "market" and that society/the state/government/whatever does have a responsibility in ensuring as fair a society as possible.

There is absolutely nothing wrong with an employer paying someone enough to make them liable for £1m in tax, but when the government tries to say its really important that this happens now, and that they are changing the rules so that more people get these astronomical pay-outs, and yet there are millions of people starving or freezing to death? I just get a bit wary, that's all.

Priorities, priorities. Or even optics. ??

You have stated several purposes of taxation, Maizie, but nothing about the use of the cash product of taxation.

But, volver, the employer of the person who pays £1m in taxes is paying that person. What’s the problem there? Contractual master and servant relationship, reward of servant privately negotiated.

Germanshepherdsmum

You always, but always, say that taxation doesn’t fund spending Maizie, but you can’t deny the importance of it to the economy.

Its importance to the economy is primarily to control inflation.

It can also be used to make the distribution of wealth more equitable.

It can be used to influence the behaviour of consumers and businesses

It can be used to ensure that those who 'have' the most, pay the most.

It can be used for all sorts of things, but it isn't used to fund state spending.

I quite like the idea that MaizieD hinted at.

If you get a million pounds in taxes from one person, you have one very rich person with a Lamborghini.

If you get a million pounds in taxes from 1000 people, you get a self sustaining economy.

But then I'm one of those simpletons who apparently doesn't understand Financial Services. (Despite actually having worked in an FI.)