The Student Room Group

Should rich people pay more income tax?

This poll is closed

Should rich people pay more tax? Yes or No

Yes, rich people should pay more tax 49%
No, rich people should not have to pay more tax51%
Total votes: 79
Simple question. As of now there's a basic rate o 20% on the first £32,010 of income. This is followed by a rate of 40% on income above £32,010 and below £150,001. Anything above £150,000 has a tax rate of 45%. Some are of the opinion that income tax for the rich should be increased even more, some say it should be lowered so that every one pays the same percentage of income tax. I, myself, have an undecided opinion. So what do you guys think?

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I don't believe there's a problem with income tax per se, but we need a more effective tax system to target the wealthiest in society who effectively avoid paying anything close to such rates most likely based around taxation of property rather than income at the top end.
Honestly I think this country punishes people for being successful, imagine working hard to earn a lot of money and then having half of it taken away by the government
No, because laws should apply to all people equally, and excessive levels of taxation don't really increase government revenue but rather reduce it anyway.
No, they should drop the highest tax band to 40%
Yes, in addition to a wealth tax and land value tax.
Original post by DaveSmith99
Yes, in addition to a wealth tax and land value tax.

Wealth taxes are one of the worst kinds of taxes which exist; they have horrible effects for an economy.

I do support an LVT, however. They're highly efficient and highly progressive. Really, in the grand scheme of things, we ought to move away from taxing income and towards a progressive consumption tax.

Corporation tax and capital gains tax, however, should be abolished outright.
Reply 7
Yes.

Anyone who says otherwise clearly hasn't experienced poverty/stashes their money overseas.
Original post by MagicJigsaw
Honestly I think this country punishes people for being successful, imagine working hard to earn a lot of money and then having half of it taken away by the government


Do you think successful crime lords who work hard should get to keep their money?
Original post by Evening
Yes.

Anyone who says otherwise clearly hasn't experienced poverty/stashes their money overseas.


Wow, you could not sound more sanctimonious if you tried.
Original post by DaveSmith99
Yes, in addition to a wealth tax and land value tax.


Great idea have all the business owners take their companies over to Switzerland and Monaco.
Part of the problem is that people don't actually know how the tax system works. Rich people do not pay a higher level then poor people on all ther salary. They are only taxed a higher percent on anything over a certain amount- not the whole lot.
Original post by tomfailinghelp
No, because laws should apply to all people equally, and excessive levels of taxation don't really increase government revenue but rather reduce it anyway.


They do apply to all people equally. Everyone gets the same tax free allowance. Everyone gets the next but taxed at x% and if you earn more then that ; everyone gets taxed the same rate.
Yes rich people should pay more tax as they have more money that they can afford to give to improving the country.
Original post by kithu1602
Yes rich people should pay more tax as they have more money that they can afford to give to improving the country.

Higher tax burdens harm the economy too.

Take the US post-Great Society, rooting around in higher income brackets (which are almost always savings) can harm an economy's productivity growth.
Original post by DashBox
Simple question. As of now there's a basic rate o 20% on the first £32,010 of income. This is followed by a rate of 40% on income above £32,010 and below £150,001. Anything above £150,000 has a tax rate of 45%. Some are of the opinion that income tax for the rich should be increased even more, some say it should be lowered so that every one pays the same percentage of income tax. I, myself, have an undecided opinion. So what do you guys think?


A moderately progressive tax system is the way to go. All we need to do is ensure tax avoidance/evasion is made impossible.
Original post by So Instinct
Nah, imagine earning 60k and only taking 30k home give or take. Daylight robbery. I've only really begun to appreciate this after recently obtaining an actual salary. Not to mention while it sounds great on paper it doesn't seem to improve the distribution of wealth, at least nothing that is significantly felt- now if some of it was say going to subsidise an increase in national wage then yes I'd be all for it (hypothetically speaking, I'm not saying that would be a sustainable policy). Though I suppose you could argue that you don't know how significant it is until you lose it.

Ideally the aim should be to have more people on higher income brackets then to simply raise the levels of certain brackets. It's like when people complain that train drivers make so much money, but really they're only doing that because they're bitter they don't make anywhere near that or feel the benefits of a decent union. If they too had those privileges I'm sure they would be whistling a different tune.


Yes, I do agree that that is ridiculous. But when I personally say 'rich people should pay more tax', I mean actual rich people, those who make excessive amounts of money, someone on 60K is not rich and should not have 50% of their income taken away, that's insane.
Of course not.

To start with, government is greedy and spends money on diversity consultants. Secondly, with NI they already have a tax rate of 47%. Thirdly, the 45% rate has yielded more revenue than 50% was predicted to.

Original post by Meta Cognition
Wealth taxes are one of the worst kinds of taxes which exist; they have horrible effects for an economy.

I do support an LVT, however. They're highly efficient and highly progressive. Really, in the grand scheme of things, we ought to move away from taxing income and towards a progressive consumption tax.

Corporation tax and capital gains tax, however, should be abolished outright.


If by progressive consumption tax you mean VAT then i'm heavily opposed to such an idea. While taxing consumption is a great way to raise tax revenue for government, taxing aggregate demand is also explicitly a tax on jobs and growth. By making it more progressive (assuming you want a higher upper rate than 20%) you also encourage the rich to consume abroad when they buy their Ferrari in a low sales tax state rather than the UK. Moral of the story being, VAT should be abolished completely if possible.

Personally i don't see any problem with taxing profits at all so don't mind corporation tax however i would certainly cull business rates which are yet another cost to business and likely the consumer.

Original post by ibzombie96
A moderately progressive tax system is the way to go. All we need to do is ensure tax avoidance/evasion is made impossible.


Unless you support protectionism or are willing to make examples of people and firms (i.e. kicking a company out the country for not paying their tax) then that won't happen. Tax deductions should be reviewed and reduced though, it's just pandering to the rich.
Original post by Rakas21
If by progressive consumption tax you mean VAT
VAT is not progressive.

While taxing consumption is a great way to raise tax revenue for government, taxing aggregate demand is also explicitly a tax on jobs and growth.

What? Consumption taxes are so good precisely because of the low deadweight loss relative to other forms of taxation. If if there were some negative impact on aggregate demand due to the tax, monetary policy could quite easily compensate.

Personally i don't see any problem with taxing profits

You can't tax businesses; businesses don't own chequebooks or make an income. Corporation taxes are highly regressive and mostly fall on long-run labour.
Original post by Meta Cognition
VAT is not progressive.

What? Consumption taxes are so good precisely because of the low deadweight loss relative to other forms of taxation. If if there were some negative impact on aggregate demand due to the tax, monetary policy could quite easily compensate.

You can't tax businesses; businesses don't own chequebooks or make an income. Corporation taxes are highly regressive and mostly fall on long-run labour.


I thought by progressive consumption tax you just wanted a more progressive VAT.

It may be good when compared to substitutes however i'd still prefer maximum consumption (without consumers becoming overleveraged) and hence would shift taxation away from consumption and more towards the likes of land.

I'm curious to hear more.

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