Should we be more open to a wealth tax?

GrannyGravy13

MaizieD

If you keep the poor poor, where are rich people going to get their money from?

Any ideas, anyone?

I imagine the poorest demographic in the U.K. are getting their money via the Government in Universal Credit in it’s entirety or as a top up on their low wages.

Along with working in the grey economy.

The very rich will make money producing goods, renting properties, playing the stock market, buying and selling works of art etc.

I wouldn’t worry about them personally.

And where does the money they get from the government go?

What do people in work spend their money on?

Who benefits from the spending of both categories?

MaizieD buying and selling more and more expensive items -houses, art, jewellery, holiday resorts etc etc. Money making money

vintageclassics

I rather think it depends on what qualifies as wealth. I have a 400 year old cottage I bought 40 years ago 2.5 beds large garden and worth probably over £450k, nice area friendly neighbours etc - does that make me wealthy? I really don't want to downsize to a 2 bed on some commuter estate. In terms of available cash yes I have some savings (much of which I do pay tax on) and a pension which is also taxed - I'm comfortable but wouldn't describe myself as wealthy. Why on earth don't we charge companies that operate and profit from trading in the UK pay Corporation tax on those profits? HSBC, Amazon, Facebook, Daily Mail, and any other foreign owned biz?

You sound similar to me. ‘Comfortable’, yes, but not wealthy.

DH has a bad knee. If it gets so he needs a knee replacement, and he would have to go on a long waiting list, we would pay to have it done privately.

That’s the sort of thing I want to have money for, although I think it’s not fair on those who have saved and been careful with their cash.

MaizieD the poorest in society spend their money in the local economy.

Those with excess money at the end of the week/month/year save and invest.

Saving and investing is something which consecutive governments, over many years have actively encouraged.

The billionaires, some are altruistic and support foundations, research facilities and charities.

The bottom line in my opinion is that the majority of people want to hang on to as much of their money/earnings as they can in order to provide a good life for them and their loved ones.

Wealth isn’t a crime, sort out the current tax loopholes first, then look at taxation overall.

GrannyGravy13

MaizieD the poorest in society spend their money in the local economy.

Those with excess money at the end of the week/month/year save and invest.

Saving and investing is something which consecutive governments, over many years have actively encouraged.

The billionaires, some are altruistic and support foundations, research facilities and charities.

The bottom line in my opinion is that the majority of people want to hang on to as much of their money/earnings as they can in order to provide a good life for them and their loved ones.

Wealth isn’t a crime, sort out the current tax loopholes first, then look at taxation overall.

Where does the money that the ‘poorest’ have spent in the local economy then go? Who gets it next and where do they spend it?

Aveline

MaizieD buying and selling more and more expensive items -houses, art, jewellery, holiday resorts etc etc. Money making money

So, are you seeing the money as being contained in an endless self contained loop, being passed around among the same group of people?

Would people be able to join this group? If they could, how would they achieve it?

MaizieD you know, I know and most people on this thread know.

This same old, same old conversation…

GrannyGravy13

MaizieD you know, I know and most people on this thread know.

This same old, same old conversation…

It’s not really a conversation, GG13, it’s an encounter with a brick wall.

The UK has broken public services, 20% of its population living in poverty while a further significant proportion of it lives on a financial cliff edge. There is minimal activity in the economy, you yourself were talking of how you cannot expand, the hospitality industry is dying, high unemployment, etc. etc.

It should be blatantly obvious where the money which the state issues into the economy finishes up, yet the only reaction is shrugs and complete acceptance of gross inequality, defence of it, indeed, as if it were a god given law which cannot be altered in any way. As if the way that our economy is run is the acme of perfection which any attempt to tamper with would cause utter disaster.

Why don’t people care?

Why do you assume people don’t care MaizieD ?

You really are preaching to the wrong congregation on here 🤦‍♀️

Until a government of the U.K. has the cajunas to rip up the fiscal rules, invest in our old and outdated infrastructure, which in turn will provide more jobs (skilled and unskilled) this conversation just goes round in circles.

Sort out the benefits system back to the original purpose as a safety net not a way of life for some families across multiple generations.

Unlike you I am not angry at wealth or those that have it.

A fair few of them are self made, Dyson, Branson and the Sir Sugar’s of this world.

I’m not angry at them either, but think they should pay more tax.

Doodledog

I’m not angry at them either, but think they should pay more tax.

In the U.K. the top 1% of tax payers contribute approximately 27%-29% of all income tax receipts.

The top 10% contribute close to 60%

Source - Google

I assume you want higher earners to pay the same rate of tax on unearned income as earned income?

I would like to see a ceiling (don’t ask me where it should sit, as I can’t reasonably imagine a billionaire budget) above which tax is taken at a significantly higher level than for those on average incomes. And yes, it should include unearned income too.

People earning over £125k or so get taxed at 45%, and whilst that is a very good income, people are still working for it, as medical consultants, dentists, even some head teachers. Not all of them will have significant assets, and the younger ones will have mortgages and families to support.

Why should those whose income comes from having money not be expected to pay far more than they do?

I haven’t got a problem with inherited wealth.

I have got a problem with IHT, in my opinion it kicks in far too low.

I would start it at £3-5 million, and on a sliding scale.

Also if the money invested has been earned through legal means it would have already been taxed. Any interest paid has to be declared to HMRC, and is taxed at the appropriate rate (20% 40% 45%) unless of course it is in an ISA which successive governments have encouraged.

GrannyGravy13

Doodledog

I’m not angry at them either, but think they should pay more tax.

In the U.K. the top 1% of tax payers contribute approximately 27%-29% of all income tax receipts.

The top 10% contribute close to 60%

Source - Google

I assume you want higher earners to pay the same rate of tax on unearned income as earned income?

The % simply show just how much money they have - and that is not taking out the money that is shielded one way or another from tax.

All I want is for everyone to pay their fair share, and the share agreed by society, - not what the wealthy think they ought to be paying.

I then want the revenue to be used to fund the NHS, social care, education etc. and invested into the economy, I also guess (although I’m not happy about it) we need to invest more in defence.

Beyond the massive wealth inequality, an even bigger issue is the political power of the rich. They are able to buy/manipulate/threaten politicians into serving them rather than their constituents. So called "independent" think tanks funded by the wealthy influence government policies, the media run campaigns supporting the narrative etc.

I don't have a huge problem with wealth. I accept the fact that the distribution of money,* which is a public good, provided by the state*, will never be even because some people will always have entrepreneurial instincts and some people will always be happier to be employed and leave the entrepreneurial bit to their employer. And some people will need some sort of state support because of disability or the simple fact of lack of employment opportunities.

Communism failed because of it failed to recognise these differences and assumed that the state could control the entire direction of an economy. There were some good aspects to it, like the promotion of excellent education and healthcare for all, but it still developed a rampant hierarchy of wealth and privilege along with draconian methods of keeping the populace under control.

But modern capitalism has also failed in ways that we experience now as the economic theories which drive it have also produced a rampant hierarchy of wealth, privilege and power which intend just as determinedly as the Communist hierarchies did to maintain the status quo. And that status quo is to keep the wealthy as wealthy as is humanly possible.

My contention is that, if money is a public good, issued by the state (which it is, because any logical enquiry as to the origin of money will bring us back to that point) there is no compelling reason why a particular section of society should have the monopoly of it. It is possible for it to be more equitably distributed as the post WW2 period demonstrated.

IMO the Beveridge Report was a glorious humanitarian document which showed how the state could care for all its citizens both physically and materially. Data from that period shows that its implementation was working, albeit slowly and progressively when informed by the economic theories of one of the acknowledged 'greats' of the economic profession. Keynes factored money and human nature into his analyses in a way that the current orthodoxy has rejected.

I'm sorry that I bore everyone, but our economy is unbalanced, unbalanced by a preponderance of wealth in the hands of a few at the top and real poverty at the bottom. I believe that we could achieve a far better balance, and a more thriving economy, but while while wealth is applauded and defended by those whose money is actually being taken by the wealthy I will continue to speak against it and support its curtailment.

GrannyGravy13

I haven’t got a problem with inherited wealth.

I have got a problem with IHT, in my opinion it kicks in far too low.

I would start it at £3-5 million, and on a sliding scale.

Also if the money invested has been earned through legal means it would have already been taxed. Any interest paid has to be declared to HMRC, and is taxed at the appropriate rate (20% 40% 45%) unless of course it is in an ISA which successive governments have encouraged.

That has avoided answering my question, which was part of my reply to the one you asked me.

Why should people who work be taxed but unearned income not attract the same (or higher) levels of tax?

Also, IHT is a tax on those receiving it, not those passing it on, so by definition they haven't earned it, regardless of how the money came into the hands of the deceased.

Excellent questions, Dd

Here I am, drawn back in again!

I don't have a huge problem with wealth, I have a problem with huge wealth. As MaizeD says, our economy is unbalanced.

I have said it before on this thread, if some people are successful and become super rich, well good for them, we can't all be successful entrepreneurs and yes, some of them have started businesses which employ a lot of people. However, I don't believe they are all secret philanthropists. There have always been the "haves" and the "have nots" but the gap seems to be getting wider and I fear that if something doesn't change in our tax system many more people who now consider themselves to be "just about managing" are going to be drawn into poverty.

Excellent questions Doddledog 👏

GrannyGravy13

I haven’t got a problem with inherited wealth.

I have got a problem with IHT, in my opinion it kicks in far too low.

I would start it at £3-5 million, and on a sliding scale.

Also if the money invested has been earned through legal means it would have already been taxed. Any interest paid has to be declared to HMRC, and is taxed at the appropriate rate (20% 40% 45%) unless of course it is in an ISA which successive governments have encouraged.

Tax is payable on unearned interest in a savings (deposits often from already taxed earning)s account. above a fairly low threshold.

Why should those that inherit property from others, that have made no contribution to that property whatsoever not pay IHT? a £3-5 million starting point for paying IHT , in my view is far too high and would increase inequality

Doodledog

GrannyGravy13

I haven’t got a problem with inherited wealth.

I have got a problem with IHT, in my opinion it kicks in far too low.

I would start it at £3-5 million, and on a sliding scale.

Also if the money invested has been earned through legal means it would have already been taxed. Any interest paid has to be declared to HMRC, and is taxed at the appropriate rate (20% 40% 45%) unless of course it is in an ISA which successive governments have encouraged.

That has avoided answering my question, which was part of my reply to the one you asked me.

Why should people who work be taxed but unearned income not attract the same (or higher) levels of tax?

Also, IHT is a tax on those receiving it, not those passing it on, so by definition they haven't earned it, regardless of how the money came into the hands of the deceased.

I will try again.

I have not said that unearned income shouldn’t be taxed.

Unearned income is already taxed, (rental, interest earned, profits on stocks and shares (not ISA’s) along with CGT). It doesn’t incur NI which is a tax on employers and employees

I am a firm believer that we should be allowed to pass on our worldly goods to our nearest and dearest without the state taking a punitive proportion.

IHT should be on a sliding scale not a cliff edge as currently, and as I posted upthread be increased to £3-5 million.

I do not know how to make my views any clearer 🤷‍♀️

Inheriting a property from someone who has died is unearned income and the lucky recipient should rightly pay tax at a fair level.

I still think a threshold of £3-5 million before IHT becomes due is way too high.

The recipient is already fortunate not to have to pay any tax on the inherited sum below current thresholds on what is essentially unearned income They only pay tax above the threshold level for something they have not earned

That seems fair to me- but I appreciate others may hold a different view.

LemonJam

Inheriting a property from someone who has died is unearned income and the lucky recipient should rightly pay tax at a fair level.

I still think a threshold of £3-5 million before IHT becomes due is way too high.

Is that in England? I understand it to be £650,000 for spouses here in Scotland.