Cable Forum - The Chronicles of Rishi

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- Current Affairs (https://www.cableforum.uk/board/forumdisplay.php?f=20)

- - The Chronicles of Rishi (https://www.cableforum.uk/board/showthread.php?t=33711430)

Sephiroth

10-08-2023 15:57

Re: The Chronicles of Rishi

Quote:

Originally Posted by ianch99 (Post 36158264)

Seph, I am not sure if you are doing this deliberately but you keep referring to Income Tax in your responses. You know very well that the ultra wealthy do not accrue wealth via "income", rather they use other, more tax efficient, vehicles which attract far lower tax rates, if indeed they pay tax at all.

Ian, the problem you've got is conflating "fair and square" in the social sense with "fair and square" in tax proportion equivalence.

Your argument boils down to "it's not fair that rich people get away with tax avoidance scheme whereas the poor nurse isn't as rich and can't get away with anything". Fair enough - you don't appear to like this wealth gap.

I was referring to income tax because, like you, I believe in a fair tax system that isn't loaded towards the rich through enabled avoidance. But I also subscribe to JR's theories ( https://johnredwoodsdiary.com/2012/0...-the-rich-pay/ ) which address how taxation must also encourage investors to come to the UK.

I rather think that my stance is somewhat more rational than yours because there are adverse consequences from simply sticking it to the rich.

Hugh	10-08-2023 16:17

Re: The Chronicles of Rishi

Quote:

Originally Posted by Sephiroth (Post 36158218)

I did show in my example that a person earning £1 million per annum would pay 44% in income tax. I did not take into account any tax wheezes because I believe that government should legislate properly to close down tax avoidance schemes.

I hear you say "Exactly". I further hear you think "never would a Tory government close the loopholes" and you'd prolly be right because they've done bugger all since 2010. Furthermore, I hear you think, "it's their donors that the Tories are protecting". All of the foregoing are valid criticisms.

Now I'll ruin it all: John Redwood put forward a plan a few years ago that also has merit.

Quote:

However, at a time of economic difficulty, when the government wishes to spend so much more than it is currently collecting in revenue, there are many cries to tax the rich more. To do this successfully you need to have a tax system which attracts more very rich people here, and which tempts rich people to invest, venture and spend in ways which trigger more tax revenue from them. The higher rates introduced by the outgoing Labour and incoming Coalition governments have led to a predictable continuing drop in revenues. Taxes on wealth and income yielded 3.5% less to August 2012 than the same period the previous year.

The USA has lower tax rates on the very rich than the UK. Top rate federal income tax is 35%, compared to 50% (plus 2% NI) here. State income tax varies from 0% to 11%. Allowing an average of around 5% means the US top tax rate is more than 10% lower than the UK one.

Despite this- or more likely because of it – the US top 1% earn 17% of all the income. More importantly , they pay 37% of all the Income Tax paid. So with lower tax rates the USA achieves the goal of getting the rich to pay much more. It also has more seriously rich people, which some will dislike and others will see as helpful to pay all that extra tax. In the US the rich pay more than twice their income level. They make an overall bigger contribution than in the UK.

https://johnredwoodsdiary.com/2012/0...-the-rich-pay/

Person who earns £700k a year puts forward proposal to reduce his tax, without mentioning all the other additional taxes (like property tax, which is higher in most US States than the equivalent Community Charge, the fact that most small local towns in the US use the local police as a revenue service fining motorists)...

<shocked face>

Sephiroth

10-08-2023 16:43

Re: The Chronicles of Rishi

Quote:

Originally Posted by Hugh (Post 36158273)

Utter red herring (highlighted red).

Hugh	10-08-2023 18:15

Re: The Chronicles of Rishi

Pure coincidence, I’m sure…

---------- Post added at 18:15 ---------- Previous post was at 18:01 ----------

Quote:

Originally Posted by Sephiroth (Post 36158275)

Utter red herring (highlighted red).

You may find this informative…

https://theconversation.com/american...as%20drawbacks.

Quote:

Americans spend more time and money filing their taxes than residents of other countries

Quote:

Other countries retain progressive systems with fewer tax brackets. For example, the U.K. currently has four tax brackets, compared with seven in the U.S.

The U.S. also has different rates for ordinary income such as wages versus income such as dividends and capital gains, which are typically taxed at lower rates – in part to spur investment and also because investment income has arguably already been taxed. But the U.S. system adds complexity because capital gains on investments held for less than a year and some dividends are not taxed at preferential rates. These different rates – from different levels and types of income – reduce the chances of getting withholding right.

The U.S. system also adds complexity with the sheer number of deductions and credits available to taxpayers. Deductions reduce the amount of taxable income you have, thereby reducing your tax liability. Say a single individual has $80,000 of wage income and $15,000 of deductions. Their taxable income is $65,000. At 2022 rates, their tax liability is $9,617. Those $15,000 of deductions saved them $3,300 in taxes.

Fortunately, there are a lot deductions. Unfortunately, taxpayers often have to jump through hoops to qualify. You can deduct gambling losses but only if you have gambling winnings, state income taxes but only up to $10,000 each year, and student loan interest but only if you make less than $85,000 or $175,000, depending on your marital status.

Further, these deductions come in different flavors: “above-the-line” deductions and “below-the-line” deductions, which themselves come in two flavors – itemized and standard. Taxpayers itemize deductions only if those amounts exceed the standard deduction. That means you might spend several hours tallying receipts for itemized charitable donations only to find you can’t deduct any of them because the total is less than your standard deduction.

Credits are another valuable element of the tax system because they reduce your tax liability dollar for dollar. Let’s go back to our single taxpayer with $65,000 in taxable income and a $9,617 tax liability before credits. A $1,000 credit – say for higher education or renewable energy – reduces their tax liability to $8,617. But credits also add complexity because they can be reduced as your income increases, and they can have extensive eligibility requirements.

Thanks, but no thanks…

Sephiroth

10-08-2023 18:51

Re: The Chronicles of Rishi

Quote:

Originally Posted by Hugh (Post 36158289)

Pure coincidence, I’m sure…

---------- Post added at 18:15 ---------- Previous post was at 18:01 ----------

You may find this informative…

https://theconversation.com/american...as%20drawbacks.

That isn't what JR was suggesting. He was dealing in headline comparisons and obviously wouldn't want to bring in the baggage.

Thanks, but no thanks…

TheDaddy

10-08-2023 19:53

Re: The Chronicles of Rishi

Obviously, when are you going to learn, the devil is always in the detail, poxy soundbite politicians, bring back the experts, I reckon the majority isn't sick of them anymore

Pierre

10-08-2023 20:33

Re: The Chronicles of Rishi

Is it the opinion of the class that wealthy, and not so wealthy, individuals should actively look to voluntarily pay more tax, or should the state close all the loopholes to prevent them avoiding tax?

TheDaddy

10-08-2023 23:28

Re: The Chronicles of Rishi

Quote:

Originally Posted by Pierre (Post 36158302)

Or option C, when the aggressive tax avoidance schemes are found not legal do them for evasion or at least make the penalties for the most egregious examples worth it as currently there is no reason not to chance it

ianch99

11-08-2023 09:46

Re: The Chronicles of Rishi

Quote:

Originally Posted by Pierre (Post 36158302)

So much to break down in a single sentence.

- there is no class here, just people debating opinion
- no one, from what I recall, mentioned "not so wealthy" so you are making a clear attempt to derail the argument here
- also, the term "wealthy" I think is only used by you, again to muddy the waters? I tried to be more precise and use the term "ultra wealthy" i.e. individuals who have more than £500m (-ish) in assets.
- no one mentioned they should voluntarily pay more tax, that is a dumb suggestion
- so yes, high net worth individuals should not pay an effective tax rate of less than an "average" salaried citizen. Now, we can debate what the exact figure is but you get the idea
- and finally (Esther), yes, the state should close all the loopholes to prevent them avoiding tax (offshore)

---------- Post added at 09:46 ---------- Previous post was at 09:43 ----------

Quote:

Originally Posted by Sephiroth (Post 36158269)

Seph, just to be clear here: I do not have a problem with the wealth gap per se, rather I have a problem with the contribution gap.

Don't forget, these people have more money that they can realistically spend in their lifetime and if they paid tax as the rate you & I pay it, they would still have more money that they can realistically spend in their lifetime.

Pierre

11-08-2023 10:00

Re: The Chronicles of Rishi

Quote:

Originally Posted by ianch99 (Post 36158332)

So much to break down in a single sentence.

- there is no class here, just people debating opinion

it was just a term, nothing to read into. You are looking to hard!

Quote:

- no one, from what I recall, mentioned "not so wealthy" so you are making a clear attempt to derail the argument here

you don’t have to be ultra-wealthy to find yourself paying a lot of tax and wishing to avoid doing so.

Quote:

- also, the term "wealthy" I think is only used by you, again to muddy the waters? I tried to be more precise and use the term "ultra wealthy" i.e. individuals who have more than £500m (-ish) in assets.

use of the word precise followed by ish. What if their assets aren’t liquid?

Quote:

- no one mentioned they should voluntarily pay more tax, that is a dumb suggestion

your asking them not to avoid paying more than they need to

ianch99

11-08-2023 10:38

Re: The Chronicles of Rishi

Quote:

Originally Posted by Pierre (Post 36158335)

it was just a term, nothing to read into. You are looking to hard!

you don’t have to be ultra-wealthy to find yourself paying a lot of tax and wishing to avoid doing so.

use of the word precise followed by ish. What if their assets aren’t liquid?

your asking them not to avoid paying more than they need to

The net increase of wealth should be taxed. I don't care what state of sublimation their assets are in. In the same way that HMRC does not care where you money is when they send you a tax bill.

Riddle me this: what would you prefer?

- the ultra wealthy keep their billions

or

- part of their increasing wealth is used to improve your local services e.g. GPs, Hospitals, Care Homes, Council services, Libraries, Youth services, etc.

Damien

11-08-2023 10:41

Re: The Chronicles of Rishi

The laws need to be changed so people pay the tax we as a society decide they should. Unless they're using illegal schemes then everyone will pay as little tax as they are legally able to for the most part, as they should.

ianch99

11-08-2023 10:46

Re: The Chronicles of Rishi

Quote:

Originally Posted by Damien (Post 36158338)

The laws need to be changed so people pay the tax we as a society decide they should. Unless they're using illegal schemes then everyone will pay as little tax as they are legally able to for the most part, as they should.

And this is the essential point here. The tax laws are not made by "We, The People", rather they are made by those who have vested, outside interests and sponsors. The issue is not people not paying tax illegally, it is that that are allowed, no encouraged, to pay less tax if they are ultra-wealthy.

If you want some context and encouragement in this area, please watch The Big Short on Netflix. It is a brilliant expose of the 2008 crash and who engineered it and why.

Mr K	11-08-2023 14:04

Re: The Chronicles of Rishi

BBC News - Migrants moved off barge over Legionella bacteria fears
https://www.bbc.co.uk/news/uk-england-dorset-66476538

Is this the most incompetent useless Govt ever? I think it is, they can't even get the xenophobic stuff right.

Could certainly be a a storyline for 'The Thick of It'. But prob. rejected as too far fetched, like the Rwanda storyline.....

jfman

11-08-2023 14:09

Re: The Chronicles of Rishi

Quote:

Originally Posted by Mr K (Post 36158353)

I doubt the barges will stand legal scrutiny. It’s convenient to have an excuse to get everyone off. A bit like The Hunt for Red October.

They don’t need to be a success for the Tories to get xenophobic momentum. Arguably there is more political capital in their plans being scuppered to give them more powers.

Remember despite their majority in the House of Commons this is the Scoody Doo villain Government - they’d have gotten away with it if it wasn’t for those pesky lefties, lawyers, remoaners, civil servants, etc.

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