The Labour Government

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meltonblue said:
It didn’t go down, it went up but by not as much as they expected even post allowance for changes in behaviour and that rearrangement of earnings.
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It did got down. The 50p rate was introduced in April 2010 as reflected in the 2010-11 figures below, from the HMRC. Look what happened.

Now some of the tax in 2009-10 was due to people hurriedly paying themselves more in that year, in order to avoid the 50% in the following year**. So the effect is exaggerated. But look at 2008-09 as well, still much higher (with a max 45% rate) than 2010-11 with the 50%. Even in 2011-12, at 50% it was still bringing in less.


** which kind of proves my point: A lot of wealthy people have flexibility in their earnings and can rearrange their affairs in order to reduce their tax bills, if rates get too penal.
1727192496743.png
 
Vic said:
That was crazy though. Kids having to move school and all sorts. Another Tory policy now too expensive to reverse.
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I was thinking more about the elderly who, for obvious reasons, didn’t want to move from their social house. In fairness they wouldn’t have had as many options on where to go etc so it’s not exactly comparable but we have huge emotional attachment to our homes.

I agree the bedroom tax was far more complex and policy getting made before capability to deliver it fairly was there.
 
Kompany Car said:
Yes but the taper starts at... wait for it ...£260k !

To quote the government website "The annual allowance is tapered (reduced) for higher earners. It is reduced by £1 for every £2 someone earns over £260,000 (including pension contributions). Tapering stops when the annual allowance reaches £10,000."

By that point you really are in the realms of being able to have a good tax accountant to avoid it.

I've said it before, but the Scottish income tax bands make sense to me and seem fair.

https://www.mygov.scot/income-tax-rates-and-personal-allowances
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Them Scot’s are going to run out of band names if they want to add more…

The bit in the middle band
The bit just after the bit in the middle band
 
Kompany Car said:
Yes but the taper starts at... wait for it ...£260k !

To quote the government website "The annual allowance is tapered (reduced) for higher earners. It is reduced by £1 for every £2 someone earns over £260,000 (including pension contributions). Tapering stops when the annual allowance reaches £10,000."

By that point you really are in the realms of being able to have a good tax accountant to avoid it.

I've said it before, but the Scottish income tax bands make sense to me and seem fair.

https://www.mygov.scot/income-tax-rates-and-personal-allowances
Click to expand...
Sorry, missed the bit about the Scottish tax system. I don't have a problem with the rates generally and certain aspects I like but it does seem overly complicated to me.

Personally I would advocate a system that is as simple as possible.A huge loss to the exchequer in terms of tax revenue collection is incorrectly completed tax returns. People either deliberately, or more typically accidentally, filling it in wrong because the rules are too complex.

So I would go for something really simple like a personal allowance of about £20k. (I don't think anyone earning less than that should be paying tax, because life on those incomes is tough enough as it is. That takes millions of people out of the tax system altogether, which I think would be a great thing to do.

Then I'd have probably a 25% basic rate up to earning of around £60k. And then perhaps a 47% rate over that. And that's it.

I'd have to play with the maths to make it add up. But you could play with the maths to make it add up. Anyone earning less than £20k would win, obviously. The break even point would be around £35K with anyone below that better off and anyone above it, worse off but not by much for most people. Someone on £100k would be £2.5k worse off - and could easily afford that. And of course anyone on much more would be paying a lot of their income at 47% not 45%.
 
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