Rich pricks are rich because they are smart

The Poms are copping it hard from their rich pricks who are taxed too much.

The Institute for Fiscal Studies warned that the tax has led people earning more than £150,000 to resort to legal tax avoidance schemes to escape paying the higher rate.

The findings will increase pressure on George Osborne, the Chancellor, to scrap the 50p rate next year.

Paul Johnson, director of the IFS, said: “It looks like the 50p rate may be too high and that it is possible it will reduce tax revenues.

“It could lead to more people investing in tax avoidance, illegally hiding their income or even leaving the country altogether. I wouldn’t have introduced the 50p rate in the first place”

The findings contradict previous estimates by the Treasury that the 50p rate would raise £2.7 billion a year. Mr Osborne has asked HM Revenue & Customs to report on the impact of the tax by next year, which could lead to it being abolished by 2013.

According to the IFS, the highest rate which can be introduced without a reduction in tax revenue is about 40 per cent.

Socialists of course argue that tax rates on the rich should be even higher, but there is a point, and in the UK it looks like it is 50% where it becomes detrimental to the revenue base.

There is ample evidence world wide that cutting tax rate actually increases revenue. Of course the other obvious solution to re-building a country’s coffers is to spend less as well. Fat chance of the entitled voting for that.

 

 


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  • David

    My brother has simply cut down the hours he works as an anesthetist to keep under the threshold, by the time you add national insurance contributions etc you are paying 60 percent tax. Dumb socialists.

  • “..and in the UK it looks like it is 50% where it becomes detri­men­tal to the rev­enue base…”

    so we can safely crank it up to 48-49%..?

    that’s good news/leaves lots of room to move..eh..?

    and david…yr brother has probably also seen a positive adjustment in his life/work balance..eh..?

    .it’s all good..!

    ..eh..?

    phil(whoar.co.nz)

    • Or even better. Get the economy really moving by eliminating income tax and welfare altogether.

      • diabolos

        Best suggestion i’ve heard in a long time. Tax cripples society. People dont work second or third jobs because they get screwed by the tax.

        You cant (in my opinion – god i love that phrase) tinker with areas of an economy in isolation. Either changes are sweeping, top to bottom to treat it like the ecosystem it is – or better not to tinker. Just like the negative effects of simply raising the minimum wage (duh) in isolation .. you arent going to solve worlds the problems by simply becoming punitive in another area – ie ‘tax the rich’.

        Douglas and Lange and crew – also tinkered with things in isolation in my view. Douglas and his acolytes still want to tinker with knobs (pardon the expression) and tweak levers – all in isolation from the whole problem. Sweeping changes i reckon should also encompass the social element etc as well – but not in the classic way most people on the right may view that statement.

  • alex

    Thats not necessarily true. Those who become rich do work hard yes, but its not like their wealth comes from thin air. They generate it by using the labour of others and taking the profits. I’m not saying that this is inherently wrong, but the rich should definitely be giving back to the people who got them where they are. And frankly, given the number of rich not paying their fair share of tax in Britain, its not suprising how bad the government debt is there. If the avoiders payed what they owed, thats half the problem solved right there.

    • alex “the rich should def­i­nitely be giv­ing back to the peo­ple who got them where they are” … that’s bullshit. Do the CEOs not pay salaries? Do the companies not distribute dividends to shareholders? Fact is the rich DO give back, and a far higher rate than any other sector of society.

      “given the num­ber of rich not pay­ing their fair share of tax in Britain, not supris­ing how bad the gov­ern­ment debt is there” The top rate is 50% FFS. As with all other graduated legalised theft schemes, the rich pay far more than all other sectors of society combined. Government debt in Britain is crippling for exactly the same reason that it is right across the West. Decades of entitlement mentality. Decades of rampant vote-buying through welfare. Decades of corporate cronyism, with failing companies being bailed out for no reason other than their Executives are mates with politicians.

      The West’s economic problems have NOTHING to do with the rich and the amount of income tax they pay.

  • Mr Blobby

    You are all getting a bit confused. Some of you sound like you are entering the bewilderment stage of your lives.

    What the top marginal tax rate is irrelevant as it makes up a relatively low amount of Tax.

    100,000 @ 30% = $30,000
    100,000 @ 38% = $38,000

    Net $8000 if $100,000 of your income is at the top rate.

    The real problem is that we have a number of taxes both Direct and Indirect apart from the big ones PAYE and GST, there are numerous other Taxes alcohol, Tobacco, Local Government, ACC, petrol. Lets take petrol every time you fill up your car half the cost is Tax. That is tax that you pay after you earn your money and pay PAYE first.

    Every day a case is made to introduce even more innovative Tax’s Carbon, Financial, fresh air there is no shortage of ideas.

    The issue is that the total tax take is more like 45% of GDP (income) in some countries it is higher.

    The question, is it sustainable for any Government to require such a big contribution from its citizens to run the Country on there behalf.

    How high can the percentage go before the system collapses under its own weight?

    • diabolos

      Good points – and i think you are right – indirect taxation is killing us all.

      • Hard1

        Jesus , Diabolos , I thought you’d gone for a piss , but there you are , back again .

  • diabolos

    Yep Hard1 – im slithering around everywhere popping up all the time

  • Right on, Hard1. Just when we thought that we were safe!

    • diabolos

      Its all ok Gazzaw – im really quite harmless. If i cant convert you to Leftism – i’ll bore you to death instead. Its all part of the master plan.

  • Ferdinand

    Not “smart” they are “cunning”.

    The idea that tax on the highest earners should be scrapped because it makes people dodge tax is simply idiotic. It’s already that UK tax dodging – by the rich and corporations – loses 20 billion a year.

    That Gantt fool up there lives in a fantasy world. Distributing to shareholders (substantial shareholders are a tiny proportion of the population) is not “giving back”, it’s enriching another minority. Tax is progressive, they are paying according to their earnings like EVERYONE does, that theirs is overall larger stands to reason, but it’s still fair.

    You’re right on one thing; “The West’s economic problems have NOTHING to do with the rich and the amount of income tax they pay.”

    Correct, but not for the reasons you might think. The problem at root is the orthodox economic drivel which allows them to stack up enormous wealth while half the world lives on crumbs.

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