2022 mini-budget discussion

[wildman]

Same as someone earning 20k right. Why don't they just on the dole? Get a council house?

Why does anyone work?

Hang on I think you've evoked an actual existential crisis, brb

maybe because Thatcher saw fit to sell off all the council houses and not actually replace them ?...... just saying

Also it's much easier for someone on 100K+ to make life style adjustments compared to someone on 20K. Contrary to the propaganda printed in the daily heil and express not all low income earners have 600 inch wide screen TV's , SKY Q, smoke 60 B&H a day etc. The majority are already struggling to make ends meet, buy economy / own make brands and have very few of the daily luxuries that 100K earners take for granted.

 

[Ahleckz]

Employees without any control are most of the people we're talking about here though. Pensions are great to avoid paying tax but don't help you with the here and now.

And yes, whilst pay will still always increase, if your costs go up by £10k you need an extra £25k of salary to offset it, which is absolutely huge! And between mortgages and energy, that order of magnitude cost increase is hardly speculative...

The point you rich bois keep ignoring is that if costs go up £10k, those earning £100k have more scope to tighten their belts and mitigate some of those costs by cutting elsewhere. They do not need to increase their salary. Someone on £20k who is seeing relative increases is less likely to be able to cut back as they have been doing so already and there is nothing less to cut.

 

[SpeedFreak]

The personal allowance trap is frustrating because it is catching an ever increasing proportion of people. The thresholds haven't moved in 12 years whilst the average salary has increased by 25%. Again, it's a first world problem, but it does encourage people to defer income to mitigate the impact where they can.

 

[krooton]

The personal allowance trap is frustrating because it is catching an ever increasing proportion of people. The thresholds haven't moved in 12 years whilst the average salary has increased by 25%. Again, it's a first world problem, but it does encourage people to defer income to mitigate the impact where they can.

But roughly 97% of earners are below the 100k threshold, and roughly 1% sit in the 100-125k affected range.

 

[rG-tom]

The point you rich bois keep ignoring is that if costs go up £10k, those earning £100k have more scope to tighten their belts and mitigate some of those costs by cutting elsewhere. They do not need to increase their salary. Someone on £20k who is seeing relative increases is less likely to be able to cut back as they have been doing so already and there is nothing less to cut.

ok, fairly normal £100k single income family, 450k mortgage with 25 years left, which is probably even a bit low for a small 2.5-bed terraced or semi somewhere commutable to London (assuming ~550-600k purchase price). 2% fix comes to an end, rate is now 6%. Mortgage goes from £1900 to £2900 pcm. That's £12k per year more cost before you've even looked at energy increases etc. £12k per year is 20% of that entire family's take home, just from an increased mortgage rate. Where are they going to tighten their belt? They can't downsize. If they move further away, they won't be able to commute. Somewhere else in the country their job might not exist or might have a significantly lower pay that makes moving a net pointless effort financially, or could cost more if they rely on family for anything.

Remembering that all mortgages are limited to gross income multiplier, not net, the "issue" here scales fairly evenly whether someone is on 30k or 100k, except that the extra earning required to offset becomes far, far higher. Someone on £100k is not exactly rolling around in lots of money. Do you REALLY believe that a person who is doing ok but FAR from wealthy be subject to 60% punitive marginal tax on any pay rise they then get? It's COMPLETELY the wrong part of society to be targeting.

Am I saying that people on 20k / 30k aren't also going to face issues? No, nobody is, and of course, this is a **** show for them too. But their life is amazing compared to kids starving in Africa with no access to fresh water, so why should we care about someone who is still in the top 1% of global earnings? Everything is relative, just because someone else might be even worse impacted it doesn't mean that there isn't a struggle for somebody else that we should be trying to help mitigate

TLDR: someone on 100k in the south east is not rich. You're basically the only person arguing that the 60% marginal rate is a good thing and still fit for purpose 13 years after it was introduced without an increase. it's not even good for increasing tax take as anyone who can afford to uses pensions etc to avoid it, where as more people would be likely to take it as income if this was scrapped putting money back into the economy now when it's needed, and 40% of something is better than 60% of the nothing many people try and pay currently!

 

[Murf]

But roughly 97% of earners are below the 100k threshold, and roughly 1% sit in the 100-125k affected range.

Don't let facts get in the way of a good whinge!

I'm currently in that 1%. Makes no odds to me that the quirks of the system means my marginal rate is higher. I'm still better off for every penny my income goes up. If you're in the top 3% of earners you've basically won the game financially. How anyone can complain about it is absolutely beyond me.

 

[Goodie]

ok, fairly normal £100k single income family

you lost me at this bit. For the vast majority that in itself is an unaffordable luxury.

 

[Murf]

ok, fairly normal £100k single income family........

TLDR: someone on 100k in the south east is not rich. You're basically the only person arguing that the 60% marginal rate is a good thing and still fit for purpose 13 years after it was introduced without an increase. it's not even good for increasing tax take as anyone who can afford to uses pensions etc to avoid it, where as more people would be likely to take it as income if this was scrapped putting money back into the economy now when it's needed, and 40% of something is better than 60% of the nothing many people try and pay currently!

Absolutely nothing normal about a 100k single income family. That person is in the top 3% of earners. Someone on 100k in the South East is rich, relative to most others in the South East.

 

[Ahleckz]

ok, fairly normal £100k single income family, 450k mortgage with 25 years left, which is probably even a bit low for a small 2.5-bed terraced or semi somewhere commutable to London (assuming ~550-600k purchase price). 2% fix comes to an end, rate is now 6%. Mortgage goes from £1900 to £2900 pcm. That's £12k per year more cost before you've even looked at energy increases etc. £12k per year is 20% of that entire family's take home, just from an increased mortgage rate. Where are they going to tighten their belt? They can't downsize. If they move further away, they won't be able to commute. Somewhere else in the country their job might not exist or might have a significantly lower pay that makes moving a net pointless effort financially, or could cost more if they rely on family for anything.

Remembering that all mortgages are limited to gross income multiplier, not net, the "issue" here scales fairly evenly whether someone is on 30k or 100k, except that the extra earning required to offset becomes far, far higher. Someone on £100k is not exactly rolling around in lots of money. Do you REALLY believe that a person who is doing ok but FAR from wealthy be subject to 60% punitive marginal tax on any pay rise they then get? It's COMPLETELY the wrong part of society to be targeting.

Am I saying that people on 20k / 30k aren't also going to face issues? No, nobody is, and of course, this is a **** show for them too. But their life is amazing compared to kids starving in Africa with no access to fresh water, so why should we care about someone who is still in the top 1% of global earnings? Everything is relative, just because someone else might be even worse impacted it doesn't mean that there isn't a struggle for somebody else that we should be trying to help mitigate

TLDR: someone on 100k in the south east is not rich. You're basically the only person arguing that the 60% marginal rate is a good thing and still fit for purpose 13 years after it was introduced without an increase. it's not even good for increasing tax take as anyone who can afford to uses pensions etc to avoid it, where as more people would be likely to take it as income if this was scrapped putting money back into the economy now when it's needed, and 40% of something is better than 60% of the nothing many people try and pay currently!

I’ve never said the 60% rate is a good thing. I’ve just said that if you are earning over £100k then you should be comfortable and are able to tighten your belts and cope with the increased costs.

What you and others high earners seem to refuse to accept is that you should have to tighten your belt and it’s woe is us. You are so out of touch that you don’t realise there are people out there who are starving AND freezing because they have nothing else to cut. If your mortgage has gone up £900 (mine is going up to over £1500 from £1050 in March so I can talk with a bit of knowledge here), you cut back. You don’t have that holiday. You don’t go for that BMW. You change supermarket. You buy suits from Matalan. There are loads you can do to divert your expenditure to somewhere else. You extend your term on your mortgage. You seem to think this isn’t possible. Everyone else has.

Or, why doesn’t someone else in the household get a job? Many people have two or three jobs. You’re so out of touch you think a £100k single earner has no options. You really don’t have a clue what it’s like out there for the majority of people, let alone the very poor and vulnerable.

 

[McBain]

Thread title needs to be renamed to 'Are you a peasant on 100K'. Or 'What 100K gets you'.

 

[Rai200]

ok, fairly normal £100k single income family

That's not normal at all, and I live in the south East.

A household income of £100,000 puts you so far above most that it's literally off the chart.

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A household income of £100,000 puts you in the top 5%.

 

[rG-tom]

Don't let facts get in the way of a good whinge!

I'm currently in that 1%. Makes no odds to me that the quirks of the system means my marginal rate is higher. I'm still better off for every penny my income goes up. If you're in the top 3% of earners you've basically won the game financially. How anyone can complain about it is absolutely beyond me.

you're in newcastle! of course you're doing ok in the top 1%.

 

[Chris Wilson]

I'm curious as to the sort of cash savings these people in the heady 100K a year bracket have, and whether they are mortgage free, or if not, how long before they are? To me this is an eye opening thread, compared to some here I must live like a pauper as I can get by and run this place on what must be a relative pittance.

 

[Ahleckz]

you're in newcastle! of course you're doing ok in the top 1%.

Lives in a HUGE house and drives a pretty expensive car and moans he’s struggling because he doesn’t live in Newcastle. Aye ok mate. Get some perspective and humility. You’re doing fine.

 

[Rai200]

you're in newcastle! of course you're doing ok in the top 1%.

London has 9 million people, that's 13.5% of the UKs population. Earning £100,000 puts you in the 97th percentile of earners.

If the top 3 per cent aren't doing OK, even assuming they all lived in London that would mean the other 10.5% or 7 million people are royally ****ed.

 

[Deleted member 77746]

London has 9 million people, that's 13.5% of the UKs population. Earning £100,000 puts you in the 97th percentile of earners.

If the top 3 per cent aren't doing OK, even assuming they all lived it London that would mean the other 10.5% or 7 million people are royally ****ed.

Exactly!

 

[dlockers]

I'm curious as to the sort of cash savings these people in the heady 100K a year bracket have, and whether they are mortgage free, or if not, how long before they are? To me this is an eye opening thread, compared to some here I must live like a pauper as I can get by and run this place on what must be a relative pittance.

Same as everyone else - none, and 25 years.

 

[Murf]

you're in newcastle! of course you're doing ok in the top 1%.

I'm in the 1% that is within that band (100-125k), so 97th percentile. Admittedly if you looked at the North East alone I'm probably more likely to be in the 99th percentile.

I can't wrap my head around how you can't get this. How do you think people on £97,500 survive in London? How do people on the NMW survive??

 

[rG-tom]

I’ve never said the 60% rate is a good thing. I’ve just said that if you are earning over £100k then you should be comfortable and are able to tighten your belts and cope with the increased costs.

What you and others high earners seem to refuse to accept is that you should have to tighten your belt and it’s woe is us. You are so out of touch that you don’t realise there are people out there who are starving AND freezing because they have nothing else to cut. If your mortgage has gone up £900 (mine is going up to over £1500 from £1050 in March so I can talk with a bit of knowledge here), you cut back. You don’t have that holiday. You don’t go for that BMW. You change supermarket. You buy suits from Matalan. There are loads you can do to divert your expenditure to somewhere else. You extend your term on your mortgage. You seem to think this isn’t possible. Everyone else has.

Or, why doesn’t someone else in the household get a job? Many people have two or three jobs. You’re so out of touch you think a £100k single earner has no options. You really don’t have a clue what it’s like out there for the majority of people, let alone the very poor and vulnerable.

FWIW, i'm not talking about my own scenario, at all. I don't currently have kids, and both my wife and I have good jobs where these increases are defeinitely annoying (I've just locked into a new mortgage, and my mortgage is actually going up £900pcm) but thankfully not particularly life-changing for us as it stands bar making some small changes to the nice-to-haves in life.

I do know people who are in the scenario I'm talking about though, including people I work with, and I think that the 60% marginal rate is wholly unfair and incorrectly placed. How could someone on a PAYE salary of a million take home more of a £10k increase in pay than someone on £100k? Utterly ridiculous, not fit for purpose and needs scrapping. Get rid of the 60% marginal rate. increase the 45% rate to ~200k (or even leave it where it is). Add a 50-55% rate above £3-400k. These are changes that make tax far fairer and keeps taxation progressive instead of having a blip for no reason. This would take larger chunks from those who actually earn a truly large amount.

 

[chroniclard]

I'm curious as to the sort of cash savings these people in the heady 100K a year bracket have, and whether they are mortgage free, or if not, how long before they are? To me this is an eye opening thread, compared to some here I must live like a pauper as I can get by and run this place on what must be a relative pittance.

We have about 13 years left here on the mortgage I think.