Rishi's proposed 'wealth tax'

[Gordon EF]

44 minutes ago, DeeTillEhDeh said:

 

 

 

 

 

Tell me where in my post I used the figure of £500k?

 

I said that I thought that middle earners would end up paying it because they'll have a much lower threshold than that.

 

It will also come down to how wealth is calculated - I personally trust these fuckers as far as I could throw them - just watch the loopholes for those at the top to exploit.

 

Fair enough. £500k is the figure that's being banded about, didn't read you properly.

[DeeTillEhDeh]

Fair enough. £500k is the figure that's being banded about, didn't read you properly.

As I said - I trust the Tories as far as I could throw them - what they say and what they do are two entirely different things. 

 

 

I'm just very cynical when it comes to their taxation policies.

 

The £500k figure is that being put forward by the Wealth Tax Commission:

 

https://moneyweek.com/personal-finance/tax/602503/britain-mulls-a-wealth-tax-again-can-it-ever-work

 

Do you have sources that Sunak himself is proposing that to be the threshold?

 

 

[Guest Jedi]

Wouldn't be surprise to see the Tories set the threshold at £500K (for all of home, cash, pension, etc), as, as said that would cover 2% of the population (if that). 

Gives them their easy headline...we set a wealth tax to save the country, while the accountants get busy squirreling a lot of that £500K away.

Don't see why £80K+ (as earnings) can't come under a higher bracket than at present, as again it is a small % of people who are on anything like that.

[coprolite]

3 hours ago, welshbairn said:

It depends on your personal allowance apparently. And you have to take into account the drop of NI to 2% from 12%.

 

2 hours ago, parsforlife said:

Whilst that’s true.  If your earning 31k a year your barely paying anymore tax than someone on 29k.  You might be paying 40% tax but your only doing that on 0.3% of your income.

 

Agree this and Welshbairn's above. The point is that our supposedly progressive tax system isn't actually that progessive in terms of taxing very high earners. 

It's been not bad at being progressive at low levels and if you count tax credits as part of tax rather than benefits, actually redistibutive. But that's being eroded with universal credit. 

11 minutes ago, Jedi said:

Wouldn't be surprise to see the Tories set the threshold at £500K (for all of home, cash, pension, etc), as, as said that would cover 2% of the population (if that). 

Gives them their easy headline...we set a wealth tax to save the country, while the accountants get busy squirreling a lot of that £500K away.

Don't see why £80K+ (as earnings) can't come under a higher bracket than at present, as again it is a small % of people who are on anything like that.

Kind of agree, although I'm not sold on a wealth tax as it may well cost as much as it brings in. We do already have a wealth tax of a sort, it's just only payable the once. 

The real unfairness in the tax system is that you get taxed more on income from work than income from having assets. There is no NI on buy to let rents. Dividend rates are lower than PAYE tax. Offshore investors pay 20% interest (if that). 

We can tax the incone from wealth better. 

[Theroadlesstravelled]

The Government has finally bled dry the lower and middle classes and the social services so they’re going to hit the upper middle class.

I bet not one penny will go to the NHS or social programs. It’ll all be wasted on HS2 and Brexit subsides.

[bendan]

11 hours ago, parsforlife said:

Whilst that’s true.  If your earning 31k a year your barely paying anymore tax than someone on 29k.  You might be paying 40% tax but your only doing that on 0.3% of your income.

 

It's actually been pointed out that it's not true - you need to earn above about 43k (PA + 30k) in Scotland to pay higher rate. 

 

9 hours ago, Jedi said:

Wouldn't be surprise to see the Tories set the threshold at £500K (for all of home, cash, pension, etc), as, as said that would cover 2% of the population (if that). 

I'm comfortably over that - I don't believe for a minute I'm even near the top 2%. I don't think the Tories would ever include first homes in the calculation. In fact, I doubt they'd go for a wealth tax. There's easy money to be had reducing tax relief on pension contributions, so I think that's where they will start.

 

[Mr Waldo]

40% tax on pay over 50k doesn't seem harsh.  It's the non PAYE income they need to go after.

[Suspect Device]

I don't have a problem with them taking 1% of my pension pot. In the last 10 years it's been growing at about 20% a year due to the cheap money that's been sloshed about with QE and low interest rates. I'd like to say it's because of my stock picking acumen since I moved to a SIPP but I know that the system had been rigged in favour of the rich with stocks and shares. I've just ridden on their coat tails.

And my pension isn't near £500k. Yet. 

 

The problem, as always, is maximising the tax take with the minimal squealing from whoever you're taking it off.

Edited December 21, 2020 by Suspect Device

[bendan]

47 minutes ago, Mr Waldo said:

40% tax on pay over 50k doesn't seem harsh.  It's the non PAYE income they need to go after.

Just scrapping employee NI and merging it into income tax would hugely increase the take from unearned income. One of the great ironies is that people on low incomes and the Guardian etc would find a way to be up in arms about it.

[bendan]

2 minutes ago, MixuFruit said:

Possibly a daft Q but can Scotland vary NI or merge it like that, or is that beyond their powers on tax?

No, it's beyond their powers.

Edited December 21, 2020 by bendan

[coprolite]

1 hour ago, bendan said:

It's actually been pointed out that it's not true - you need to earn above about 43k (PA + 30k) in Scotland to pay higher rate. 

 

I'm comfortably over that - I don't believe for a minute I'm even near the top 2%. I don't think the Tories would ever include first homes in the calculation. In fact, I doubt they'd go for a wealth tax. There's easy money to be had reducing tax relief on pension contributions, so I think that's where they will start.

 

ONS says you're in the top 30%

Hand it over Lord Snooty, we've got a trainset to pay for. 

[bendan]

16 minutes ago, coprolite said:

ONS says you're in the top 30%

Hand it over Lord Snooty, we've got a trainset to pay for. 

I've got an old trainset if you want it.

Your quote (accidentally) makes it look like I'm saying I earn well over 43k - but I don't.  I'm kind of semi-retired and on a modest income, but I have a house with no mortgage. I'm precisely the kind of person who would be screwed over by a wealth tax that included the main property in the calculation.

[Gordon EF]

2 hours ago, bendan said:

I'm comfortably over that - I don't believe for a minute I'm even near the top 2%. I don't think the Tories would ever include first homes in the calculation. In fact, I doubt they'd go for a wealth tax. There's easy money to be had reducing tax relief on pension contributions, so I think that's where they will start.

 

20 minutes ago, coprolite said:

ONS says you're in the top 30%

Hand it over Lord Snooty, we've got a trainset to pay for. 

I think the 2% data and this one are measuring different things. This one includes pensions so the bar is going to be much higher. It's also household, I think the other one was individual.

Edited December 21, 2020 by Gordon EF

[coprolite]

2 minutes ago, bendan said:

I've got an old trainset if you want it.

Your quote (accidentally) makes it look like I'm saying I earn well over 43k - but I don't.  I'm kind of semi-retired and on a modest income, but I have a house with no mortgage. I'm precisely the kind of person who would be screwed over by a wealth tax that included the main property in the calculation.

I said nothing about income. 

I think a wealth tax that includes pension pots and first homes, set at £500k would lose the Tories the next election. 

That said, the current govt is quite unpredictable. They actually have hit mid size entrepreneurs quite hard by scrapping the scheduled corporation tax cut and restricting entrepreneurs relief. So they might... 

But those are still relatively niche blocs within the Tory vote. £500k pension and house covers half of their supporters, and it’s an aspiration for the other half. I'd reckon you're safe. 

[bendan]

20 minutes ago, coprolite said:

I said nothing about income. 

 

Yes, I know, it was just the way the quoting system put two separate things I'd said together.

I agree there's no prospect at all of the Tories putting a wealth tax on first homes and pension pots. That would be the equivalent of Labour slashing the top rate of tax.

[coprolite]

2 minutes ago, bendan said:

Yes, I know, it was just the way the quoting system put two separate things I'd said together.

I agree there's no prospect at all of the Tories putting a wealth tax on first homes and pension pots. That would be the equivalent of Labour slashing the top rate of tax.

I reckon if they could devise the most regressive way possible they might do it. 10% of gross home value (not net of mortgage) capped at £50k. That should do it. 

[Gordon EF]

I think excluding pensions and first homes and bringing in a lower threshold would seem like the best way to go. 

You'd also have to think reasonably carefully about shared assets. You don't want to be hitting couples just over the threshold whilst leaving out single people just under it.

[Thistle_do_nicely]

not going to pretend that I'm clued up, but from what i know about it i fucking hate VAT as a tax (iirc companies by and large just collect it since they offset any VAT from sales against VAT from purchases so its really only consumers that actually have any liability to pay it, companies just collect it). Hopefully they either leave it untouched or better yet drop the VAT rate/start getting more items zero rated for it. 20% on the cost of most goods and services is huge if you're on a low income.

[coprolite]

2 minutes ago, Thistle_do_nicely said:

not going to pretend that I'm clued up, but from what i know about it i fucking hate VAT as a tax (iirc companies by and large just collect it since they offset any VAT from sales against VAT from purchases so its really only consumers that actually have any liability to pay it, companies just collect it). Hopefully they either leave it untouched or better yet drop the VAT rate/start getting more items zero rated for it. 20% on the cost of most goods and services is huge if you're on a low income.

Technically that's right about VAT*. Also PAYE, except the employer's ni is collected and paid on behalf of employees. Neither of these stop large corporates, the cbi or client journalists from quoting these quite large figures as "we paid tax of £x bn last year" 

*VAT exempt businesses (eg dentists, care homes) can't reclaim VAT so actually have to pay it. 

[coprolite]

8 minutes ago, MixuFruit said:

A Philip Green favourite that.

Funnily enough i had a mental picture of him while i was typing. It was quite unpleasant.