What level of taxation is "fair"?

[Shadez]

lets look at how poor i am....

In the UK poor is:
- Double glazing yes, but its ****
- Central heating no, dam storage heaters
- Sky HD Nope, i dont have an HD TV
- Cigarrettes Ok i admit it i smoke
- University grants No grants for me
- Child benefit no
- Social housing no
- A 3 peice suite no, only got 2 peices
- Holidays abroad never had any holidays abroad
- Legal/fire/health cover i dont get any of this for free
- Free education nope i have to pay if i want to be teached stuff

so only 1/11 making me less than poor

 

[scorza]

Everyone gets taxed the same, everyone would get 16k tax free. I don't get where you are coming from. 16k is what is deemed nessecary to live in th uk or at least was. Can't find any recent figures. So no one is being taxed different like you suggest.

That's exactly the same as a progressive income tax regime then, just less progressive.

By the way, even with our supposedly unfair progressive income tax thresholds, holistically high earners generally pay a smaller proportion of their income than low earnings. This is nothing to do with tax avoidance it's to do with the regressive nature of tax in the UK that isn't called income tax e.g.

National Insurance - a regressive form of income tax where high earners pay tax at a lower rate than lower earners
Council tax - something like 30% difference between a council house and a mansion
VAT - lower earners spend a much higher proportion of their income, so are adversely affected by this regressive tax.

 

[Haggisman]

But the rate should be set at or just above the breadline what ever that is. Anything above that is a luxury and as such flat tax. If that is now 20-25k then that's fine. But that sounds way to high.

Why should it be set just above the breadline?

What's wrong with allowing everyone (well, everyone who works) a few luxuries, and then having a much higher tax rate above that?

Pay those who don't work a bare minimum - perhaps vouchers for food/bills etc, so they can't waste it.

People who work, and are on low wages earn enough to live on and can afford to treat themselves occasionally - there's your incentive for working rather than scrounging.

Everyone pays the same much higher percentage of tax on earnings above the threshold.

Problem?

 

[Glaucus]

Again it depends what you class as high earners. Millionaire and business owners pay less. High earners on paye system can't avoid it and pay more.

Why should high earners pay proportionally more? What's progressive about that? Neither should the poor struggle whilst paying tax. Or pay tax and get tax back through complicated refunds.

High tax free allowance, insures the poor can live, whilst flat tax after that means everyone's paying proportionally the same.

 

[Glaucus]

Problem?

isn't one, I just don't think it should work that way. Enough to live, want luxuries work harder and put your self out there. Or what is usually the defining charistics, take a risk.

Shouldn't be incentives to work, benefits should not be a viable option.

 

[D.P.]

So how is it fair to tax someone more because they live in rural Scotland? I thought you were advocating a flat tax rate?

I'm all for a single fixed ate but some people were complaining about varying living costs, e.g. in London. The idea of the tax free threshold is that this is the amount necessary to live by, obviously if different areas have different living costs then it can be deemed fair to have slightly different thresholds.



Besides, which a flat rate of tax isn't even a particularly fair model because those who earn more will pay more tax despite their costs to the government being the same (or even lower) all things considered. A flat rate tax is not a fair tax system, it is a balance of fairness and feasibility. If slightly varying thresholds are needed to realize the feasibility aspect then it maybe necessary.

 

[Haggisman]

Again it depends what you class as high earners. Millionaire and business owners pay less. High earners on pate system can't avoid it and pay more.

Why should high earners pay proportionally more? What's progressive about that? Neither should the poor struggle whilst paying tax. Or pay tax and get tax back through complicated refunds.

High tax free insure the poor cab live, whilst flat tax after that means everyone's paying proportionally the same.

I think we're agreeing on this, the only difference being I feel that both the tax free amount and the flat tax rate should be higher.

 

[George Hincapie]

Didnt read thread.

But anyone that owns more than one house should be royally rogered for tax IMO.

Why? Because you're a clampet and are jealous? They should be applauded for their success IMHO.

 

[stuman]

LOL.
snip*

- Child benefit = what's wrong with child benefit?! You know kids result in costs, right?

snip*

IF YOU CANT AFFORD THEM DON'T BRING THEM INTO THIS WORLD.

it's downright selfish.

 

[Haggisman]

isn't one, I just don't think it should work that way. Enough to live, want luxuries work harder

Someone needs to do the low paid jobs. Why do you feel it's appropriate to punish them for it?

That's ignoring the fact that I'm sure many people in low paid jobs "work harder" than some of the people in cushy well paid office jobs that they only got because daddy happens to know someone.

and put your self out there. Or what is usually the defining charistics, take a risk.

And what do you propose should happen to these people when they (as you put it) "take a risk" which doesn't pay off? Leave them to starve?

Shouldn't be incentives to work, benefits should not be a viable option.

If there weren't incentives to work, no one would work.

 

[Glaucus]

How am I punishing some one? You have a titaly back to front attitude like a large part of society who think you should get something for nothing.

Who said anything about letting people starve? Not me.

The incentive to work is to by food live and buy things/do things which you can't do with no money.
You don't need extra incentives to work. Again this shows your backwards attitudes. Benefits should never be better option than working.

 

[D.P.]

That's exactly the same as a progressive income tax regime then, just less progressive.

By the way, even with our supposedly unfair progressive income tax thresholds, holistically high earners generally pay a smaller proportion of their income than low earnings. This is nothing to do with tax avoidance it's to do with the regressive nature of tax in the UK that isn't called income tax e.g.

National Insurance - a regressive form of income tax where high earners pay tax at a lower rate than lower earners
Council tax - something like 30% difference between a council house and a mansion
VAT - lower earners spend a much higher proportion of their income, so are adversely affected by this regressive tax.

NI: no, there is a relative cost of providing health and social charges per person. There is no need to tax someone more several times what their NI costs would be. The fact that NI tax exists at all makes it a progressive tax. The alternative is we scrap any national health service and resort to 100% private health insurance.

Council tax is one of the most unfair taxes there is. The only truly fair tax would be to tax each person in the residence because they are the ones contributing to the council costs. The size of one house makes not a single bit of difference to the running costs incurred by the council, and it is no measure of someones wealth. If someone inherits a large property but has a small salary, why should they have a large council tax? The most fair system is a fixed tax per person. The best balance of fairness and feasibility is to tax a fixed rate on the income of all adults who earn. This is the model used in almost every other country on the planet, normally going by the name local tax. Council tax is a medieval invention based on the ability to rent your spare bedrooms out to strangers. It has had no reverence for the last hundred years or more. The Poll tax was a clear and logical step forwards, pity we will never see it enforced.

VAT:, you have this the complete wrong way round. VAT is a consumer tax that taxes those with more available income. Low income earners will hardly buy anything that has VAT, because VAT is levied on luxury items. The necessities of life like food and water are not subject to VAT, while HD TVs, Sky, cigarettes, x-box etc. are taxed.

 

[mollymoo]

IF YOU CANT AFFORD THEM DON'T BRING THEM INTO THIS WORLD.

it's downright selfish.

In Canada you pay a tad more, schooling costs money so they sort of tax you for that when you have kids, sounds like a good idea to me.

 

[Radiation]

We should only be taxed at the point where work is done and certain services are used, it should also be possible to see where every penny of our money goes as well.

 

[scorza]

Again it depends what you class as high earners. Millionaire and business owners pay less. High earners on paye system can't avoid it and pay more.

Why should high earners pay proportionally more? What's progressive about that? Neither should the poor struggle whilst paying tax. Or pay tax and get tax back through complicated refunds.

High tax free allowance, insures the poor can live, whilst flat tax after that means everyone's paying proportionally the same.

I pointed out that it was nothing to do with avoiding tax and everything to do with the regressive nature of the UK tax regime as a whole - income tax is the only progressive tax we have, everything else is highly regressive. Unfortunately the Times article I'm thinking of is behind Murdoch's pay wall now, so there's no point linking to it, but a study by the UK Treasury found that people earning less than £10k a year were paying something like 45% of it in tax. People earning over £100k a year were only paying 32% of it in tax. The study did not look at the issue of tax avoidance. Regressing income tax with a flat tax will only make that inequality worse.

 

[Nitefly]

That doesn't mean they should have to pay more. That's a ******* stupid argument in my book.

It doesn't. Starvation is a great incentive to work.

k

Its not really about fairness though, it is about whats necessary.

To be truely fair everyone would pay the same flat percentage of their income.

... and have the same upbringing and opportunities

 

[Haggisman]

How am I punishing some one? You have a titaly back to front attitude like a large part of society who think you should get something for nothing.

Who said anything about letting people starve? Not me.

The incentive to work is to by food live and buy things/do things which you can't do with no money.
You don't need extra incentives to work. Again this shows your backwards attitudes. Benefits should never be better option than working.

I mostly agree with you, but I think you're missing the point I'm trying to make, so I'll break it down for you (all values are guesses and used for illustrative purposes).

You state that £16k is the amount required to live on.

Therefore, for someone to live on benefits, they require £16k.

You also state that you believe £16k should be the tax free threshold, therefore someone who is actually working and earning £16k, will be in exactly the same position as someone on benefits.

Someone earning £18k will only be seeing an extra £100/month, which isn't really a significant amount - by raising the tax free threshold you're increasing their incentive by 2/3.

Where is the incentive to work harder if you get punished for it?

By increasing the threshold, you make working a more attractive option as you actually get reap the fruits of your labour rather than simply seeing it taken straight back off you.

That's the situation we're in at the moment - it makes more sense for people with low earning potential to stay on benefits than it does for them to work, because as soon as they hit a (very low) earnings threshold, they are in a worse financial position than they would be doing nothing.

 

[Glaucus]

And why do they pay that amount in tax? Is it because we have a stupidly low tax threshold, vat is levied on some vital goods and poor people buy lots of luxuries they shouldn't be buying. How many have decent tvs for a start.

Also why shouldn't better if save money and as such don't pay vat or other taxes on that portion.

We aren't purposing current tax systems. And a different tax system would sort many of these issues out. While some of the "unfair" tax is due to people living outside their means and as such paying vat and other taxes they shouldn't be incurring.

 

[Castiel]

... and have the same upbringing and opportunities

yep, which is why the concept of fairness is so subjective......and ultimately can never actually be fair by everyones perspective.

 

[Glaucus]

I mostly agree with you, but I think you're missing the point, so I'll break it down for you (all values are guesses and used for illustrative purposes).

You state that £16k is the amount required to live on.

Therefore, for someone to live on benefits, they require £16k.

You also state that you believe £16k should be the tax free threshold, therefore someone who is actually working and earning £16k, will be in exactly the same position as someone on benefits.

Where is the incentive to work?

Not at all benefits wouldn't be 16k cash.
Benefits would be vouchers, it would also be shared living in flats/houses/apartments. They can live and not have the equivalent of 16k. 16k is the private buying rate. So massive incentives to work and do as you please.

How on earth can people on benefits have a nice house, when loads of us on decent money have to share.