Friday, April 04, 2014
Taxing the rich
Today's Times reports that George Osborne is facing demands to cut the top rate of tax again to 40p after figures suggested the wealthy had paid more tax since he cut the 50p rate.
This is not something that I can personally support but the significance of the article lies not in the demands of those who believe that the wealthy should contribute proportionately less than the low paid, but in the way it debunks Labour's narrative.
The paper says that the amount raised from top-rate taxpayers is expected to increase by £9 billion in 2013-14, the year for which it was reduced to 45p by the Chancellor. Data from HM Revenue and Customs showed that in 2012-13 the 50p top rate brought in £39.3 billion for the Exchequer, from earnings of more than £150,000 a year. In 2013-14, the new 45p top rate will have netted £48.4 billion from the wealthy.
Labour have argued consistently that reducing the top rate from 50p to 45p is helping millionaires. Unfortunately, the facts have now proved them wrong. Will they change their policy stance?
This is not something that I can personally support but the significance of the article lies not in the demands of those who believe that the wealthy should contribute proportionately less than the low paid, but in the way it debunks Labour's narrative.
The paper says that the amount raised from top-rate taxpayers is expected to increase by £9 billion in 2013-14, the year for which it was reduced to 45p by the Chancellor. Data from HM Revenue and Customs showed that in 2012-13 the 50p top rate brought in £39.3 billion for the Exchequer, from earnings of more than £150,000 a year. In 2013-14, the new 45p top rate will have netted £48.4 billion from the wealthy.
Labour have argued consistently that reducing the top rate from 50p to 45p is helping millionaires. Unfortunately, the facts have now proved them wrong. Will they change their policy stance?
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Lib.Dems, Labour -anyone who wants to grow services, not cut them - needs to tackle the over-taxation of income and the massive under-taxation of accumulated wealth.
If a maximum rate of tax of (say) 30% was to be augmented by a (say) 5% annual 'cut and come again' tax on overall wealth, it would incentivise, and also begin to erode entrenched inequalities.
There are massive logistical problems about evasion but self--declaration, accompanied by loss of entitlement to anything not declared could be a way coward.
Is this pie in the sky or do you see some merit here?
If a maximum rate of tax of (say) 30% was to be augmented by a (say) 5% annual 'cut and come again' tax on overall wealth, it would incentivise, and also begin to erode entrenched inequalities.
There are massive logistical problems about evasion but self--declaration, accompanied by loss of entitlement to anything not declared could be a way coward.
Is this pie in the sky or do you see some merit here?
No, in principle that is in line with Lib Dem thinking too. Cant get it past the Tories of coursse but expect a similar approach in our 2015 manifesto
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