Crosswords0 min ago
raising the tax level
I see on the news today that nick clegg wants to raise the tax level for when people start to pay tax to £10000. Why could there be any opposition to this from anyone? In fact why not raise this figure to £20000. this would give poorer people a lot more money that they need to spend on stuff they want , therefore boosting the econonomy.. If you gave the tax relief to the rich they already have everything they need already, so it gets put into there bank accounts and its never actually used.. Also by giving the poor the extra money they make work more appealing to the lazy element in society and encourages them to work for a living..surely its a no brainer.. so why the opposition?
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I would imagine there is opposition because the money to fund this has to be found from somewhere.
I'm no economist, but I would imagine the money would be found through spending cuts and/or increased taxation for higher earners.
This then raises the question of what is a higher earner. Are higher earners those in the 40% tax bracket? Given this applies to those earning just over £40k a year, I would suggest not. Over £100k? possibly.
It seems a great idea in principle, but in practice I would imagine some people will be hit - and I suspect those hit the hardest will be people who earn between, say, £50k to £80k (no question they are good salaries, but it doesn't make them 'rich').
I'm no economist, but I would imagine the money would be found through spending cuts and/or increased taxation for higher earners.
This then raises the question of what is a higher earner. Are higher earners those in the 40% tax bracket? Given this applies to those earning just over £40k a year, I would suggest not. Over £100k? possibly.
It seems a great idea in principle, but in practice I would imagine some people will be hit - and I suspect those hit the hardest will be people who earn between, say, £50k to £80k (no question they are good salaries, but it doesn't make them 'rich').
the extra money that will be spent will generate money for the economy through extra VAT and the rich could pay more in tax by having fewer loop holes in the system that they can hide there earning in. Id like to think if i was lucky enough to have millions if not billions of pounds behind me Id be willing to pay my share of the taxes needed by this country, And not try to suck the country dry.. If not for myself but for my kids and grandchildrens future..
An unusually good idea from the libdems, perhaps getting into bed with the Tories has woken them up a bit! Any reduction in direct taxation is good, frankly there is no reason not to remove it altogether, it only accounts for about a 5th of tax income anyway and large amount of that is taken up in collecting it. All money becomes tax in the end so they'll get it back through indirect taxation.
As I understand it - this will benefit everyone, not *just* those on very low incomes.
The problem is - if the lower tax threshold were taken up to £20,000, it would be not only take a large number out of the tax system, but also everyone earning *over* £20,000 would see their tax burden fall substatially.
I personally would love it - I'd be quids in...but how could we afford it?
By the way, what is the lower tax threshold at the moment???
The problem is - if the lower tax threshold were taken up to £20,000, it would be not only take a large number out of the tax system, but also everyone earning *over* £20,000 would see their tax burden fall substatially.
I personally would love it - I'd be quids in...but how could we afford it?
By the way, what is the lower tax threshold at the moment???
@SP - recent budget - tax free earnings allowance gone up to around £8,300 or so, intention being to bring it up to £10,000 by 2015.Clegg is calling for an acceleration of that, and given the current economic circumstances, that seems like a very good idea. All would benefit, but the poorer would benefit proportionately more.
Shoving up tax free earnings allowance to £20,000 pa might be problematic though............
Shoving up tax free earnings allowance to £20,000 pa might be problematic though............
Its all very good, but I suspect that Clegg is aware that its not going to happen.
When Osbourne set his agenda, like or loathe it, budgets would have been set, as would targets and promises made to august financial institutions and indeed a lot of stock market "floatability" would rest on what is perceived as future economic strategy.
So Cleg can spout what he likes, safe in the knowledge that overall stratagy won't be chaning, but he can walk around going "well I tried".
When Osbourne set his agenda, like or loathe it, budgets would have been set, as would targets and promises made to august financial institutions and indeed a lot of stock market "floatability" would rest on what is perceived as future economic strategy.
So Cleg can spout what he likes, safe in the knowledge that overall stratagy won't be chaning, but he can walk around going "well I tried".
People in well paid jobs are opposing this because they will pay more tax. They tend to be higher educated and in more influential pisitions than people on ten grand. They also tend to be Tory voters, so it won't happen.
The compromise will probably be the worst of all worlds. The high eaners will not be taxed more but local services (mainly for the poor people) will be cut further.
The compromise will probably be the worst of all worlds. The high eaners will not be taxed more but local services (mainly for the poor people) will be cut further.
"so why the opposition?"
i imagine those who bemoan funding the treasury gap for benefit scum/cheats/etc etc will expand this to include low earning thicko's who should aspire to greater things, and question why they have 50" plasmas, eat junk food and drive brand new ford asbo's.
other than that, dunno.
i imagine those who bemoan funding the treasury gap for benefit scum/cheats/etc etc will expand this to include low earning thicko's who should aspire to greater things, and question why they have 50" plasmas, eat junk food and drive brand new ford asbo's.
other than that, dunno.
I see what you mean Gromit. Food for thought though, money that is not tied up in assets for years is effectively tax anyway. So even if direct tax was 0 there would be more people spending more money spent paying all the indirect taxes. I don't know the answer but has anyone ever calculated what the effects of 0 income tax would be?
It was rumoured that the mansion tax whose houses are worth more then £2mn will pay for it although I don't think that would cover it. It is against Tory principles to give more handouts to the poor as they would really like to give handouts to the rich or business community and let the trickle down effect take place.
gromit
It's not just people earning below £10K who will benefit if the threshold is raised, every taxpayer will benefit.
As for the revenue lost being regained from the higher paid is an assumption. The treasury could bring in a tax on cats and dogs or anything else that isn't taxed at the moment to get the revenue. They could even increase VAT.
If you remember, in 1997, New Labour said they would not raise Income Tax. They raised National Insurance instead.
Benjamin Franklin said in 1789 "In this world nothing can be said to be certain, except death and taxes."
It's not just people earning below £10K who will benefit if the threshold is raised, every taxpayer will benefit.
As for the revenue lost being regained from the higher paid is an assumption. The treasury could bring in a tax on cats and dogs or anything else that isn't taxed at the moment to get the revenue. They could even increase VAT.
If you remember, in 1997, New Labour said they would not raise Income Tax. They raised National Insurance instead.
Benjamin Franklin said in 1789 "In this world nothing can be said to be certain, except death and taxes."
Everyone would be better off depending on the rate of tax you pay . It would be worth £240 for those on the lowest 20% rate and £700 for those on the 50% rate. Therefore the higher rates would have to be raised by several percent to prevent them gaining anything and higher still to pay for the loss of income to the treasury from the basic rate payers unless Clegg can pull another rabbit out of the bag to pay for it. A mansion tax would could help somewhat.
Although basic rate taxpapers would benefit, it is not true to say that everyone would benefit. The recent trend when basic rate allowances have been increased is to lower the starting point at which the 40% tax rate kicks in. Many workers who do not consider themselves well off now find they are paying some tax at 40%
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