Autumn Budget 2022

The more tax you pay, the more annoyed you’ll be at having to pay it to cover government mismanagement (Truss, Johnson). We’re not getting much bang for tax buck thanks to them. I don’t think any earner is happy that they are gifting cash to this lot so they can cosplay at politics. Bad value!
 
delta0 said:
Yes but you are implying that because someone earns more than another they should not complain about having higher tax increases. Someone that earns £21k should not complain because someone else is earning £20k. They should be happy they earn more as they have more cash in their pocket.
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It's certainly not what I am meaning.

I am simply asking why the higher limit earners feel they are being squeezed more than those on the lower bandings (but above benefit levels)

That Sky News link states that someone on £62k is paying £1,600 more tax from the budget yet doesn't show their workings.

I'm challenging that by asking why. Why does someone on £62k pay £1600 more tax in 2023/24 than they will in 2022/23 tax years if they don't get a wage increase?

I am only using the £62k salary as that's what Sky News have used. I am not using this amount for any other reason e.g. "they earn more than enough so should moan" as it's all relative.

I could use a salary of £100k or £44k, the same question would be asked.
 
Mercenary Keyboard Warrior said:
As said when I quickly looked I think they have pulled the projection of the future out so with inflation coming in the pay rises will be more heavily paid in tax.

Its the problem with these sorts of thing. I don't doubt its right for the scenario they have come up with, at the end of the day its simple maths.
1600 in tax at 40% is a payrise of 10%. IE someone on £60k now getting basically an inflationary rise will get £6k pay rise. 40% of that is £1600.

If they are spending the majority of their current income after tax then assuming they do have personal inflation of around 10% then they are going to have a larger gap in what their new costs are compared to someone who instead of earning £60k earns £30k.
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I was writing that last post as you posted so missed this.

Completely agree with you that it's a possibility but they don't state that. That doesn't sell news stories though I guess

Even if that is the case, they are still taking home more than they did so are not being squeezed any more than the rest due to the budget which is what those reports are suggesting.

The only people who see a real terms cut in their income is people >£125k who received an actual tax rise without any wage increase.
 
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Tax is what it is but we don't have to like it. I also consider employer NI as part of the burden so in my view my contribution is bordering on 48% effective which does feel a lot. I wouldn't mind, but public services, schools, hospitals are all getting worse and worse.
 
Isn’t the point “more squeezed then they should have been”?

Without mismanagement things would not have had to be like this, in fact some would say these tax burdens are a political choice.

That’s why I’d assert that people feel squeezed, i.e. what they are having to pay as opposed to actually paying it.

eta, I am in no way advocating something like the swivel eyed Truss/Kwareteng fantasy!
 
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Richie said:
I'm challenging that by asking why. Why does someone on £62k pay £1600 more tax in 2023/24 than they will in 2022/23 tax years if they don't get a wage increase?

I am only using the £62k salary as that's what Sky News have used. I am not using this amount for any other reason
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The source for those numbers isn't talking about 22/23 vs 23/24, which probably causes some initial confusion.
 
Kenai said:
The source for those numbers isn't talking about 22/23 vs 23/24, which probably causes some initial confusion.
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From what I’ve seen it’s based on the threshold freeze over the next 4 years. The person earning £62k today will be earning more over that period due to to pay rises. As more people get dragged into the higher rate tax threshold (expected to be 25% of the workforce next year alone) it will hurt people’s take home even more.
 
delta0 said:
From what I’ve seen it’s based on the threshold freeze over the next 4 years. The person earning £62k today will be earning more over that period due to to pay rises. As more people get dragged into the higher rate tax threshold (expected to be 25% of the workforce next year alone) it will hurt people’s take home even more.
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The £62k figure is the 27/28 earnings rather than today but essentially yes, the argument is that this budget means someone projected to be earning £62k in 27/28, will have £1600 less in their pocket compared to (and this isn't particularly clear in the report) the proposals from a preceding budget.

The specific phrasing they use is "relative to if none of the policy changes since 2021 happened".

Figure 32 in the Resolution Foundation report is a better visualisation of the claims that 'middle earners' will get squeezed most, as it shows in percentage terms the expected impact across the earnings range.

As usual media over simplification has people looking for a reason why their tax bill will be £1600 higher next year, which isn't even close to what the original report was getting at.
 
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I think reality is starting to hit that you cannot have European style welfare systems and public services with US levels of taxation. With an ageing population and no dramatic change in retirement age, taxation is only going to go one way unless people are willing to accept a private free for all like over in the States.

And that's before even considering the transitory impact of post-COVID disruption, the energy crisis and continuing war in Ukraine.

Our whole tax system needs serious reform, it's far too complicated and there's far too many marginal tax rates depending on individuals circumstances, some of which are quite punitive.
 
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MichaelAwkward said:
I think reality is starting to hit that you cannot have European style welfare systems and public services with US levels of taxation. With an ageing population and no dramatic change in retirement age, taxation is only going to go one way unless people are willing to accept a private free for all like over in the States.

And that's before even considering the transitory impact of post-COVID disruption, the energy crisis and continuing war in Ukraine.

Our whole tax system needs serious reform, it's far too complicated and there's far too many marginal tax rates depending on individuals circumstances, some of which are quite punitive.
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Happy to pay more tax for guaranteed income, thing is I do t trust any of them.
 
MichaelAwkward said:
I think reality is starting to hit that you cannot have European style welfare systems and public services with US levels of taxation. With an ageing population and no dramatic change in retirement age, taxation is only going to go one way unless people are willing to accept a private free for all like over in the States.

And that's before even considering the transitory impact of post-COVID disruption, the energy crisis and continuing war in Ukraine.

Our whole tax system needs serious reform, it's far too complicated and there's far too many marginal tax rates depending on individuals circumstances, some of which are quite punitive.
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More like we're taxed at the European levels with public/welfare systems at the US level.

We need a global paradigm change when it comes to taxation. The idea that we only tax when wealth changes hands (income, capital gains, etc) is just no longer fit for purpose with the challenges of a modern society, especially with an ageing population and lower number of workers per each pensioner. There simply isn't enough economic activity to support this level of public services.

We either need to accept that concepts such as universal healthcare, state pension, a benefit system, free education, etc are a thing of the past, or we need to tax wealth.

Given that taxing wealth is unlikely, on a personal level people under 50 shouldn't take any of those services for granted for their own retirements and must plan for their lives as though the state pension, the NHS, the benefit system, etc will all be scrapped.
 
Firestar_3x said:
Which would be fine if the money was used responsibly and for constructive purposes, instead a load of it is ****** up the wall, why should we be "pleased" with that?
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This was ever the case. And which country or decade could you name that has universal accord with how their taxes are spent.
 
Firestar_3x said:
Which would be fine if the money was used responsibly and for constructive purposes, instead a load of it is ****** up the wall, why should we be "pleased" with that?
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Bingo, wouldn’t mind at all if we had lots of police, an excellent NHS, functioning infrastructure, but when it just gets lost into the system it just doesn’t sit well.
 
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