50% Tax

[contango]

i'd imagine there are a few people on this forum who will applaud the introduction of the 50% tax band in last week's budget. I guess also we're all aware of the various arguments around it being a political gesture, no real relevance in raising tax revenue, likely to drive away entrepreneurs, high contributors etc. In sum, is this really going to help our country? Amongst all the wishes for lower house prices and a recovery from this mess, does anyone honestly believe this is going to have a positive contribution?

[MSWHPC]

high taxation is never a good thing

[Deckard]

is this really going to help our country?

It's certainly NOT going to help the London housing market - that's for sure.

[200p]

Capital Flight

[HAMISH_MCTAVISH]

Any tax rise is bad for the economy and bad for Britain.

As it's only for those that earn over £150K, most of them will promptly switch from PAYE to self employed/consulting basis with their employers, or leave and base themselves offshore, so the amounts raised will be negligible.

It's largely a meaningless gesture to the party base, it will have no real gain in raising revenue, and the Tories will scrap it within a few years anyway.

Typical Labour twaddle.

[contango]

or maybe when they get elected, as i'm sure they'll be able to prove what a waste of administrative time and money it is for so little gain

[miko]

Any tax rise is bad for the economy and bad for Britain.

As it's only for those that earn over £150K, most of them will promptly switch from PAYE to self employed/consulting basis with their employers, or leave and base themselves offshore, so the amounts raised will be negligible.

It's largely a meaningless gesture to the party base, it will have no real gain in raising revenue, and the Tories will scrap it within a few years anyway.

Typical Labour twaddle.

Quote on the news tonight that the tories wont be able to scrape it . Does that tell us that the money raised from it will not be negligible ? keep hearing conflicting views about how much it will raise.

[wealthy]

Good for hpc

[bpw]

I lost touch with UK tax laws after moving to the USA. Is it true that personal service companies can still be used to reduce taxes? I thought IR35 put an end to that?

Britons need to face the simple fact that taxes must increase and benefits must reduce. If the UK balance sheet is not moved into the black then there is high probability that UK debt will be downgraded to reflect the very real risk of UK PLC defaulting on its loans. In business, and fiscal finance, trust is everything. Those who think the UK can cheat the bond markets in the same way that the USA does will learn a hard lesson. To be honest I am salivating at the prospect of the UK being downgraded by the Rating Agencies since it will mean the pound will fall further (perhaps by as much as 30%) and house prices continue to crash. Lets face it - if you own a house you're just getting was was due to you.

Any tax rise is bad for the economy and bad for Britain.

As it's only for those that earn over £150K, most of them will promptly switch from PAYE to self employed/consulting basis with their employers, or leave and base themselves offshore, so the amounts raised will be negligible.

It's largely a meaningless gesture to the party base, it will have no real gain in raising revenue, and the Tories will scrap it within a few years anyway.

Typical Labour twaddle.

[aa3]

At this point we don't really need entrepenuers. When there is 4 appliance stores in a city, and a guy starts a 5th one it doesn't really benefit anyone. At best it will mean 1 of the former ones goes out of business to make room. And oh ya we only need 2 in the city now because demand has fallen and older appliances are working fine.

For brain drain, modern european countries have such a surplus of highly educated people we could lose them by the 200,000 a year and probably still the excess would get worse. As now 50% of students are going into university. And technology like accounting software programs are making it so we need less and less highly educated people.

In 25 years we will hardly need any accountants. Most corps could already get rid of 75% of their accounting departments and no one would notice the difference.

[contango]

negligible in proportion to the debt it's supposed to help pay off. guess it depends on when they calculate the no. of people actually earning 150+, but if on last year's figures i bet there will be a lot less by inception in 2010 (and even less as it gives people a few months to consult on way's around it). add in the admin costs, and i can't imagine it's significant.....probably good for swissair though with all those full flights for people coming back to visit family

[Simples]

Agree it's meant to be more of a crowd pleaser for the masses than make any meaningful difference.

At least Cameron is trying to kick-off a bit - comparing Brown & Darling to the man knocking at door checking gas meter while the other one robs you! I guess it brings the message back to the point that we're all getting truncheoned, certainly not just the 150k+ crew.

[ken_ichikawa]

At this point we don't really need entrepenuers. When there is 4 appliance stores in a city, and a guy starts a 5th one it doesn't really benefit anyone. At best it will mean 1 of the former ones goes out of business to make room. And oh ya we only need 2 in the city now because demand has fallen and older appliances are working fine.

For brain drain, modern european countries have such a surplus of highly educated people we could lose them by the 200,000 a year and probably still the excess would get worse. As now 50% of students are going into university. And technology like accounting software programs are making it so we need less and less highly educated people.

In 25 years we will hardly need any accountants. Most corps could already get rid of 75% of their accounting departments and no one would notice the difference.

Yup I noticed that myself while I worked as an accountant, the software was getting to really low levels ie people doing biz would enter in something they bought, the software would ask is this stock Y/N , is this for use in the business Y/N what sort of asset is it? Car / Plant or machinery etc.

Many of the smaller jobs who had migrated to Sage and such like barely need any work doing for them you just punch in the trial balance which is virtually what the clients give you anyway do a couple of adjustments and the job is done.

Its probably why in the next 2 years when I come back from my trip I'm getting out of accountancy for good , I just need to get a couple more months experience and one more exam then look to do something else. My dad doesn't understand this and thinks accountants will always be in demand , but then he still uses tapes and VHS.

Accountancy I think is finished in the next 10 years Indian outsourcing companies squeeze the natives , while software squeezes the others in the industry only one area left and thats tax which is my niche since its so incredibly complicated and getting more complicated that individuals seriously do need people to help them out. The tax manual when I first started to do tax was a thompson local directory , it then went yellow pages sized and is now 3 yellow pages sized.

Oh and entrapaneurs we need them but unconventional ones, in that pushing another generic store into an already crowded market does no good, reselling tat made in china is also no good...

However finding a unique niche enough to support yourself with a healthy profit is where it is at , I did do some biz support work with an inventor a few years back , he made a product nobody else had or had considered. It was a inner tube replacement bar so that bicycles and motorbikes that used tubed tyres would no longer ever need tubes without the need to seal the wheel up as normal.

Edited April 26, 2009 by kennichi

[InternationalRockSuperstar]

i'd imagine there are a few people on this forum who will applaud the introduction of the 50% tax band in last week's budget.

why?

it's not like they'll see even a single penny of it.

[contango]

i was referring to the angry element who might believe people earning those figures have benefitted and are responsible for the current situation, not that they would benefit from any taxation receipts

[shiningliao]

I cannot believe only few people happy to tax more from the rich! What else can we do? Tax more for average Joe like you and me?

I don't like Labour government get UK into this economy mess but I still welcome Labour raise tax on those rich people.

[@contradevian]

Normally I'd agree. 50% tax is a bad thing.

But this is a national emergency and tragedy. New Lab have managed to run up more debt than all the previous governments put togethor.

Shame that some of the rich have decided to act so selfishly (and predictably).

[porca misèria]

i'd imagine there are a few people on this forum who will applaud the introduction of the 50% tax band in last week's budget. I guess also we're all aware of the various arguments around it being a political gesture, no real relevance in raising tax revenue, likely to drive away entrepreneurs, high contributors etc. In sum, is this really going to help our country? Amongst all the wishes for lower house prices and a recovery from this mess, does anyone honestly believe this is going to have a positive contribution?

Please stop calling it 50%. It was already 54% on earnings above just over £40k before the rise. We're now at virtually two thirds of your marginal income at the upper end. I expect the beneficiaries of that will be tax accountants rather than the taxman.

At the same time, the real rich-peoples taxes are much lower and falling. Property: commonly nil. Capital Gains: 18% max, high threshold. Inheritance: huge threshold - the only way to get rich without the government taking most of it.

Usual story: don't touch the rich, but penalise anyone who expects to improve their lot by hard work.

OTOH, HPC is bucking that trend. Taking back a little of what's been handed to the rich, and handing it back to the productive. Except for the bailouts ...

[InternationalRockSuperstar]

Britons need to face the simple fact that taxes must increase and benefits must reduce. If the UK balance sheet is not moved into the black then there is high probability that UK debt will be downgraded to reflect the very real risk of UK PLC defaulting on its loans.

given a choice between me paying higher tax and HMG defaulting, I'd pick HMG defaulting every time.

At this point we don't really need entrepenuers. When there is 4 appliance stores in a city, and a guy starts a 5th one it doesn't really benefit anyone.

it does if it is more efficient and cheaper than the others.

At best it will mean 1 of the former ones goes out of business to make room.

well bad businesses should be allowed to fail anyway.

For brain drain, modern european countries have such a surplus of highly educated people we could lose them by the 200,000 a year and probably still the excess would get worse. As now 50% of students are going into university. And technology like accounting software programs are making it so we need less and less highly educated people.

In 25 years we will hardly need any accountants. Most corps could already get rid of 75% of their accounting departments and no one would notice the difference.

sadly true. I'm hoping state failure will change this.

i was referring to the angry element who might believe people earning those figures have benefitted and are responsible for the current situation, not that they would benefit from any taxation receipts

okey doke.

[aa3]

Yup I noticed that myself while I worked as an accountant, the software was getting to really low levels ie people doing biz would enter in something they bought, the software would ask is this stock Y/N , is this for use in the business Y/N what sort of asset is it? Car / Plant or machinery etc.

Many of the smaller jobs who had migrated to Sage and such like barely need any work doing for them you just punch in the trial balance which is virtually what the clients give you anyway do a couple of adjustments and the job is done.

Its probably why in the next 2 years when I come back from my trip I'm getting out of accountancy for good , I just need to get a couple more months experience and one more exam then look to do something else. My dad doesn't understand this and thinks accountants will always be in demand , but then he still uses tapes and VHS.

Accountancy I think is finished in the next 10 years Indian outsourcing companies squeeze the natives , while software squeezes the others in the industry only one area left and thats tax which is my niche since its so incredibly complicated and getting more complicated that individuals seriously do need people to help them out. The tax manual when I first started to do tax was a thompson local directory , it then went yellow pages sized and is now 3 yellow pages sized.

Oh and entrapaneurs we need them but unconventional ones, in that pushing another generic store into an already crowded market does no good, reselling tat made in china is also no good...

However finding a unique niche enough to support yourself with a healthy profit is where it is at , I did do some biz support work with an inventor a few years back , he made a product nobody else had or had considered. It was a inner tube replacement bar so that bicycles and motorbikes that used tubed tyres would no longer ever need tubes without the need to seal the wheel up as normal.

I feel the same way about the accounting software and outsourcing. I have accountant friends who would be angry if they heard someone talking about racism, but who say Indians will never be able to duplicate what they do. This even as a couple european companies have already moved the entire back offices to India. And I've got to assume the wave will hit over the next decade.

They feel the same way about the computers. That there is some magical ability they have that is not transferable to logic, its pure intuition and experience or something. My mother is an accountant and some in the family are accountants and they believe we will always need many accountants.

I agree with you about that kind of entrepenuer we need to really support them. I think the future for most of us is finding some crazy niche like that. Or even importing some really rare product and selling it, I've seen some people doing that and make more than very senior government management, and working 1/5th as much. And oh ya not needing any education.

But I've also seen buy to let types thinking they are entrepenuers and needing tax incentives to encourage them into business.

[bpw]

Quote: given a choice between me paying higher tax and HMG defaulting, I'd pick HMG defaulting every time.

The USA can do that, but the UK can't. If UK PLC defaults then the cost of loans will rocket and the value of the pound will fall making it even harder to service debts.

Ask yourself - if you knew someone was a scumbag that borrowed money, but didn't pay back then what rate of interest would you require if they asked you for even more money....... likewise, if the pound falls significantly, what do you think will happen to interest rates? They rise, and if they rise what happens to house prices.

Face it. People in the UK have shafted themselves by clamouring for high house prices.... Those who thought the way to make money was to cheat their sons and daughters are finding the plan has failed. The markets will punish Britain like it deserves - high taxes should not be just for the rich. Everyone in the UK will be made to pay for the Toni and Gordo miracle.

Edited April 27, 2009 by bpw

[whyohwhy]

Normally I'd agree. 50% tax is a bad thing.

But this is a national emergency and tragedy. New Lab have managed to run up more debt than all the previous governments put togethor.

Shame that some of the rich have decided to act so selfishly (and predictably).

All I can add to that is thank god they didn't do this 10 years ago and spend all the money back then- imagine how much more screwed we'd be now !!!

[Fudge]

You have to get these things in context.

Over the last 30 years there has been a massive shift of wealth from working people to the corporations and

the very rich whilst at the same time the tax burden has shifted from corporations and the very rich to the majority of working people.

Whilst the top 10% have tremendous wealth and assets the bottom 35% are up to their eyeballs in debt.

Edited April 27, 2009 by Fudge

[50%deposit]

tax increases are unimaginative. theres plenty of better ways to deal with the issues. I think govt should demonstrably be reducing tax at every possible opportunity. They can do that by reducing all wages above £30k significantly. £££££££££££ they would save yes, thinks yoda.

hey, heres an idea, how about disbanding the army?..... mmmm, or cutting it by such a huge amount. The Belgium ary does not work on Sundays, did you know.... mmmhhmhm, We could put ourselves at the mercy of the bigger countries defence. would the world really miss our input? Just an idea.

Cut all BBC funding. Cut all arts funding. Cut all overseas aid. Cut all charitable aid. The govt needs to demonstrate that they are servants to the people and they are not compromising our country. The govt seem to think they run the country... that they own it. Put up prices of certain things like quarantine, passports, and all other superflous services. Increase fines for criminals, if they had thought about it they could have impressed us. oh yeah, cut all state benefits. open work camps for the unemployed, lets see how hard they look for work then. i dont have the awnsers but the 50% rate is a simple popularity and spiteful initiative. It is a kick in the balls to the rich who have been pummelled already. Another pointless boost to HARD WORKING FAMILIES.

[Quagmire]

tax increases are unimaginative. theres plenty of better ways to deal with the issues. I think govt should demonstrably be reducing tax at every possible opportunity. They can do that by reducing all wages above £30k significantly. £££££££££££ they would save yes, thinks yoda.

hey, heres an idea, how about disbanding the army?..... mmmm, or cutting it by such a huge amount. The Belgium ary does not work on Sundays, did you know.... mmmhhmhm, We could put ourselves at the mercy of the bigger countries defence. would the world really miss our input? Just an idea.

Cut all BBC funding. Cut all arts funding. Cut all overseas aid. Cut all charitable aid. The govt needs to demonstrate that they are servants to the people and they are not compromising our country.

Why can't they start seriously looking at the cost of the EU to the UK? Also Iraq, Afghanistan, other overseas military deployments. The people don't want or need these wars and occupations. ID cards and other civil liberty bashing projects. The people don't want it.

They don't work for the people, you would think that would be obvious to the public by now. They are following an agenda set by the "elite", you don't have to be a conspiracy-nut to see that.