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Progressive tax is unfair. Discuss.
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Original post by demx9
How are you supposed to cover abolishing all other taxes ?
No tax free and a 35% flat rate would logically cover all personal taxes
Everyone should pay equal taxes. that is BY DEFINITION fair. Why are people even discussing this subject? Also poor people are poor because they are less intelligent... Intelligent people have more money because they have better jobs... Is this so difficult for people to understand? Wow the stupidity here haha
Original post by Jammy Duel
No tax free and a 35% flat rate would logically cover all personal taxes
So essentially I would have to pay 15% more tax so that rich people can save 5% tax ?
Original post by Namige
Everyone should pay equal taxes. that is BY DEFINITION fair. Why are people even discussing this subject? Also poor people are poor because they are less intelligent... Intelligent people have more money because they have better jobs... Is this so difficult for people to understand? Wow the stupidity here haha
Original post by demx9
So essentially I would have to pay 15% more tax so that rich people can save 5% tax ?
Original post by ineedtorevise127
Where do you stand on this issue? Why?
I agree with progressive tax but disagree on where the boundaries are and what the rates also are.
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Original post by demx9
I'm usually right wing when it comes to economic policy but I think progressive taxation is fairly fair.
The idea is that those with larger incomes can sustain much more on the percentage left over after a proportionate tax is made. For example if you earned 20k, 50% tax, 10k left, hard to live. 100m, 50% tax, 50m left, still flying. Crude example but that is the idea.
However you could say the greater the tax, the lower the tax revenue. Think about that.
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The idea is that those with larger incomes can sustain much more on the percentage left over after a proportionate tax is made. For example if you earned 20k, 50% tax, 10k left, hard to live. 100m, 50% tax, 50m left, still flying. Crude example but that is the idea.
However you could say the greater the tax, the lower the tax revenue. Think about that.
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Original post by will2348
I agree with progressive tax but disagree on where the boundaries are and what the rates also are.
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Original post by demx9
So essentially I would have to pay 15% more tax so that rich people can save 5% tax ?
So you're confirming that you're of the variety of people who believe there should be progressive tax to punish the successful?
The wonderful conclusion that can be drawn from this post is that you seem to think that income tax is the only tax and individual pays and that you have done little or no actual research to substantiate any thoughts you have.
What is the effect of putting it to a flat 35% rate? Well, it takes a load of different taxes that total to ~35% of your income and consolidates it all into a single tax which is 35% of your income!
Also, you would appear to think that the tax free allowance is already at 0 if nobody has a rate increase of 35%, you also forget that the very highest earners will be losing 10 percentage points and those earning over 100,000 no longer have to pay extra tax as they lose their tax free allowance.
Original post by demx9
So essentially I would have to pay 15% more tax so that rich people can save 5% tax ?
If were were going down the flat tax route it would make sense to merge NI with IT (32% effectively) and raise the rate.
You could for example raise the tax threshold to £30k and then have a flat 45% rate, 3% more for those over £60k and 2% less for those over £150k.
That would be loosely revenue neutral.
Original post by EHZ17
I'm usually right wing when it comes to economic policy but I think progressive taxation is fairly fair.
The idea is that those with larger incomes can sustain much more on the percentage left over after a proportionate tax is made. For example if you earned 20k, 50% tax, 10k left, hard to live. 100m, 50% tax, 50m left, still flying. Crude example but that is the idea.
However you could say the greater the tax, the lower the tax revenue. Think about that.
Posted from TSR Mobile
The idea is that those with larger incomes can sustain much more on the percentage left over after a proportionate tax is made. For example if you earned 20k, 50% tax, 10k left, hard to live. 100m, 50% tax, 50m left, still flying. Crude example but that is the idea.
However you could say the greater the tax, the lower the tax revenue. Think about that.
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Original post by Namige
So asking someone to pay £1 in tax compared to £0 (so £1 more) before gives less tax revenue? Hahaha!
You're not a thinker are you?
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sometimes it's quite apparent that those who oppose progressive taxation don't understand it .
before the relatively recent changes which say the personal allowance gradually removed between 100 and 150 k income, the personal allowance was sacrosanct once set ( increased by certain tax reliefs, decreased by benefits in kind, to account for declared but untaxed at source other income or to reclaim previous under payment)
You only ever pay the basic rate on the money you earn between the personal allowance and the threshold, you then pay the higher rate above that threshold ( if thereare third and fourth rates of tax as there have been in the past you pay the next rate only on income above that threshold)
I've heard people say that they would ant a big pay rise if they went into 40 % tax to cover all the extra tax they'd be paying - thus demonstrating a utter lack of understanding of how the system works.
As for the higher paid memberso the the Nursing and teachiong professionsbeing in the higher tax band , given theseare professions which require significant education - Nursing is graduate entry ( at point of registration) now and nost NQTs hold a post graduate qualification ( and it;s mainly primary tachers who can qualify with 'just' an honours degree in education). Unfortunately the populous at larger has swallowed the tea party style guff about how the public sector is over paid and underperforms ...
before the relatively recent changes which say the personal allowance gradually removed between 100 and 150 k income, the personal allowance was sacrosanct once set ( increased by certain tax reliefs, decreased by benefits in kind, to account for declared but untaxed at source other income or to reclaim previous under payment)
You only ever pay the basic rate on the money you earn between the personal allowance and the threshold, you then pay the higher rate above that threshold ( if thereare third and fourth rates of tax as there have been in the past you pay the next rate only on income above that threshold)
I've heard people say that they would ant a big pay rise if they went into 40 % tax to cover all the extra tax they'd be paying - thus demonstrating a utter lack of understanding of how the system works.
As for the higher paid memberso the the Nursing and teachiong professionsbeing in the higher tax band , given theseare professions which require significant education - Nursing is graduate entry ( at point of registration) now and nost NQTs hold a post graduate qualification ( and it;s mainly primary tachers who can qualify with 'just' an honours degree in education). Unfortunately the populous at larger has swallowed the tea party style guff about how the public sector is over paid and underperforms ...
Original post by EHZ17
Original post by Namige
Only equal tax is fair. If the fair way is that everyone is to be equal, then you must have equal tax BY DEFINITION. How can you not understand this? It's completely logical.
Well, there are exceptions to that definition and this is one of them. You could argue that putting students of all abilities in one class is 'fair' because it is 'equal' but of course it isn't because the smart kids get held back and the not so smart kids don't get the support they need.
Fairness and equality are two different concepts, one does not equal the other.
Similarly with tax, the marginal utility per pound of income is much larger at the lower end than the higher end. But, the current tax structure for sure is most certainly not maximising incentives, revenue or productivity in the economy and urgently needs addressing in my opinion.
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there are two ways to operate a flat tax
1. low or no personal allowance flat tax is a lot lower %age wise than current income tax and income tax like taxes (e.g. NI )
2. 'citizen income' / 'living wage' type figures as the tax free allowance and then a flat tax a few percentage points higher than the current Income tax and income tax like tax (e.g. NI for the UK) rate so the 'middle' while paying a higher rate pay less tax over all due to the higher personal allowance - the higher personal allowance is something the current Uk government has implemented originally an Lib Dem policy, adopoted by the coalition but now moved across into the Conservative manisfesto as well.
the living wage stuff is interesting - especially as the gap between the minimum wage and the living wage is made up by the government through tax credits and HB .
1. low or no personal allowance flat tax is a lot lower %age wise than current income tax and income tax like taxes (e.g. NI )
2. 'citizen income' / 'living wage' type figures as the tax free allowance and then a flat tax a few percentage points higher than the current Income tax and income tax like tax (e.g. NI for the UK) rate so the 'middle' while paying a higher rate pay less tax over all due to the higher personal allowance - the higher personal allowance is something the current Uk government has implemented originally an Lib Dem policy, adopoted by the coalition but now moved across into the Conservative manisfesto as well.
the living wage stuff is interesting - especially as the gap between the minimum wage and the living wage is made up by the government through tax credits and HB .
(edited 9 years ago)
I'm very much inline with the the marxist inspired social democrats of post world war II when it comes to this.
Original post by zippyRN
there are two ways to operate a flat tax
1. low or no personal allowance flat tax is a lot lower %age wise than current income tax and income tax like taxes (e.g. NI )
2. 'citizen income' / 'living wage' type figures as the tax free allowance and then a flat tax a few percentage points higher than the current Income tax and income tax like tax (e.g. NI for the UK) rate so the 'middle' while paying a higher rate pay less tax over all due to the higher personal allowance - the higher personal allowance is something the current Uk government has implemented originally an Lib Dem policy, adopoted by the coalition but now moved across into the Conservative manisfesto as well.
the living wage stuff is interesting - especially as the gap between the minimum wage and the living wage is made up by the government through tax credits and HB .
1. low or no personal allowance flat tax is a lot lower %age wise than current income tax and income tax like taxes (e.g. NI )
2. 'citizen income' / 'living wage' type figures as the tax free allowance and then a flat tax a few percentage points higher than the current Income tax and income tax like tax (e.g. NI for the UK) rate so the 'middle' while paying a higher rate pay less tax over all due to the higher personal allowance - the higher personal allowance is something the current Uk government has implemented originally an Lib Dem policy, adopoted by the coalition but now moved across into the Conservative manisfesto as well.
the living wage stuff is interesting - especially as the gap between the minimum wage and the living wage is made up by the government through tax credits and HB .
"living wage" and a real living wage are very different entities, a true living wage for full time work is, at worst, minimum wage, especially for those that aren't having to worry about living wage from job loss (i.e., those who don't have children)
Rich people already benefit from the fact that goods and services are priced at a flat rate no matter what your income. Therefore, they should expect to pay progressively more in tax.
The other alternative would be a flat tax but goods and services are charged at different rates depending on your income. This isn't as out there as it may sound: it could be said to happen to a limited extent in markets for essential goods and services, for example the rental market, where things like housing benefit essentially mean charging poorer people less to buy a slice of the market. Economists, right- and left-wing, usually see benefits as a negative income tax to which conditions are subsequently attached, not a "reward" for some quasi-economic activity like searching for jobs - the view I'm describing is like the mirror image of that.
To understand the flat part of it, you have to think of the landlord as the same as the tax-levying state: it's a flat "tax" because he receives in rent the same proportion of the value of a £100k, £200k house no matter in what proportion the tenant's income is coming from the tenant or the state. (Just as the shopkeeper prices his goods flatly at the same multiple of their cost no matter in what proportion the buyer's gross income is now owned by the buyer or the state, and just like a state with a flat tax would take tax at the same proportion of income no matter what proportion of the citizen's net income is needed for (essential) goods and services.)
I know I didn't explain that very well, mainly because I just thought it out, but hopefully someone can grasp what I'm on about.
But you can't have both flat prices for goods and services and a flat tax. That's burning the candle at both ends for the poor and having cake and eating it for the rich. It would destroy the economy at a stroke. Because the flatter the tax is, the higher the rate levied on the poor, so the lower the price of essential goods and services has to go. So the more the rich award themselves extra income in the form of tax cuts, the more they cut their costs in the form of price cuts to essential goods and services. That is a system which can only go one way with not even a brake to slow down the increase in the rate of inequality.
Having flat prices for goods and services and a flat tax is just as loony as having progressive pricing for goods and services and progressive taxation for income. That idea would be shouted down as redolent of the worst excesses of communism, and the converse idea, which young well-off people with trendy libertarian views bang on about so much, must also be shouted down as redolent of the worst excesses of capitalism.
The other alternative would be a flat tax but goods and services are charged at different rates depending on your income. This isn't as out there as it may sound: it could be said to happen to a limited extent in markets for essential goods and services, for example the rental market, where things like housing benefit essentially mean charging poorer people less to buy a slice of the market. Economists, right- and left-wing, usually see benefits as a negative income tax to which conditions are subsequently attached, not a "reward" for some quasi-economic activity like searching for jobs - the view I'm describing is like the mirror image of that.
To understand the flat part of it, you have to think of the landlord as the same as the tax-levying state: it's a flat "tax" because he receives in rent the same proportion of the value of a £100k, £200k house no matter in what proportion the tenant's income is coming from the tenant or the state. (Just as the shopkeeper prices his goods flatly at the same multiple of their cost no matter in what proportion the buyer's gross income is now owned by the buyer or the state, and just like a state with a flat tax would take tax at the same proportion of income no matter what proportion of the citizen's net income is needed for (essential) goods and services.)
I know I didn't explain that very well, mainly because I just thought it out, but hopefully someone can grasp what I'm on about.
But you can't have both flat prices for goods and services and a flat tax. That's burning the candle at both ends for the poor and having cake and eating it for the rich. It would destroy the economy at a stroke. Because the flatter the tax is, the higher the rate levied on the poor, so the lower the price of essential goods and services has to go. So the more the rich award themselves extra income in the form of tax cuts, the more they cut their costs in the form of price cuts to essential goods and services. That is a system which can only go one way with not even a brake to slow down the increase in the rate of inequality.
Having flat prices for goods and services and a flat tax is just as loony as having progressive pricing for goods and services and progressive taxation for income. That idea would be shouted down as redolent of the worst excesses of communism, and the converse idea, which young well-off people with trendy libertarian views bang on about so much, must also be shouted down as redolent of the worst excesses of capitalism.
(edited 9 years ago)
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