Why have higher taxation?

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    (Original post by TheBirdman)
    Thanks for the response. As for the importance of success, social inequality can be justified by the fact the most successful tend to provide a high quantity of jobs and without few very successful people/companies great multinationals and companies that currently benefit the economy would cease to exist. For example, if Bill Gates had not become successful the economy wouldn't have reaped the benefits of Microsoft, nor would consumers who benefit from the product. Although through high taxation, the rich will still be richer than those below, I do not believe taxation should be too high as it is essentially theft from those who worked for what they own: even if they still remain rich afterwards. But I guess that's more a battle of libertarianism vs authoritarianism to different extremes.
    A high quantity of jobs perhaps, but just like the pounds we spend, not all jobs are equally valuable. A society would be totally functional without any... circus performers, more or less despite them contributing to GDP. If you replaced them all with lower paying retail workers GDP may decrease but quality of life increase. Soldiers are an excellent example. Generally more valuable to society than their wage indicates. People wise at gambling less so. They earn a lot but for doing no real benefit to society. Also, in principle if they are provided jobs but social inequality still exists to the point where whatever one considers a "baseline quality of living" - let's say, not Brazilian slums, let's say good infrastructure, freedom, educational standards, lack of bureaucratic corruption etc, then it makes the value of the jobs be questioned! Surely less jobs, or less well paying jobs AND better other things mentioned above would result in a higher quality of life and thus a better society and therefore what we ought to pursue.

    It is essentially theft since despite 'consenting through choosing to live somewhere' since most people cannot just move. It costs money and is not simple. That said, if one is earning over 100k realistically you can just move elsewhere (and should have ample means and time to learn new languages too). Yes there are sentimental reasons not to. But you can do it nonetheless and therefore you are consenting to allow the government to that your money really, so theft perhaps is a strong term.

    Even with that said. Let's call it theft. I don't think the theft is wrong if what is stolen is then used for the greater good. At least in the extent that it is done through our sort of progressive tax system. Obviously there is a line to be drawn; you cannot have robin hood style full on theft. Or Jesus style thefts where everyone is brought to literally the same level just above the breadline. Because that doesn't lead to a functional sort of soceity! However, our tax system is nothing like that so I fail to see the issue tbh.

    One last thing on bill gates - I am not a believer in great innate facts about people. I think most of what we become is a testament to our environments. And his success in his firm was definitely due to the help of a damn lot of other people (and not just in the computer world either). Has Bill Gate's primary school teacher, carer, childminder, mother and father, GP or anyone that aided his health before he achieved his stuff, what about the man who stopped him getting bottled on a night out or hit by a stray car? Have these people earned their fair share of his wealth on the basis of the extent to which they caused him to go on and do what he did? I somehow doubt it.
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    (Original post by TimGB)
    I don't think that will make anyone richer than someone that they weren't richer than before though, since the allowance reduction comes into play in the middle of the 40% bracket, and happens very gradually. Still, it's an interesting thing I did not know about, and something to take into account when doing large tax calculations.
    I'm not arguing these figures will automatically make somebody richer than someone previously earning less than them before. I'm arguing more for the fact that such high taxation is a negative reinforcement for hard work and if taxation gets too high it can threatens the principles of capitalism.
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    (Original post by TorpidPhil)
    A high quantity of jobs perhaps, but just like the pounds we spend, not all jobs are equally valuable. A society would be totally functional without any... circus performers, more or less despite them contributing to GDP. If you replaced them all with lower paying retail workers GDP may decrease but quality of life increase. Soldiers are an excellent example. Generally more valuable to society than their wage indicates. People wise at gambling less so. They earn a lot but for doing no real benefit to society. Also, in principle if they are provided jobs but social inequality still exists to the point where whatever one considers a "baseline quality of living" - let's say, not Brazilian slums, let's say good infrastructure, freedom, educational standards, lack of bureaucratic corruption etc, then it makes the value of the jobs be questioned! Surely less jobs, or less well paying jobs AND better other things mentioned above would result in a higher quality of life and thus a better society and therefore what we ought to pursue.

    It is essentially theft since despite 'consenting through choosing to live somewhere' since most people cannot just move. It costs money and is not simple. That said, if one is earning over 100k realistically you can just move elsewhere (and should have ample means and time to learn new languages too). Yes there are sentimental reasons not to. But you can do it nonetheless and therefore you are consenting to allow the government to that your money really, so theft perhaps is a strong term.

    Even with that said. Let's call it theft. I don't think the theft is wrong if what is stolen is then used for the greater good. At least in the extent that it is done through our sort of progressive tax system. Obviously there is a line to be drawn; you cannot have robin hood style full on theft. Or Jesus style thefts where everyone is brought to literally the same level just above the breadline. Because that doesn't lead to a functional sort of soceity! However, our tax system is nothing like that so I fail to see the issue tbh.

    One last thing on bill gates - I am not a believer in great innate facts about people. I think most of what we become is a testament to our environments. And his success in his firm was definitely due to the help of a damn lot of other people (and not just in the computer world either). Has Bill Gate's primary school teacher, carer, childminder, mother and father, GP or anyone that aided his health before he achieved his stuff, what about the man who stopped him getting bottled on a night out or hit by a stray car? Have these people earned their fair share of his wealth on the basis of the extent to which they caused him to go on and do what he did? I somehow doubt it.
    It is true, to an extent, that our environments either increase or decrease likelihood to success. But it is not the be all and end all for gifted individuals who work incredibly hard, even if they must work harder than others. I do not believe the people who helped Bill rise to success (in terms such as teachers, childminders etc as you mentioned) deserve a portion of his wealth due to the fact he went on to do great things. They did the job they were being paid for at the time, if they did want more money, they could have worked for a higher position. But Gates' success is his own: the only people sharing his wealth should be those he chooses to share it with personally and those who helped to build his empire.
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    (Original post by TheBirdman)
    I'm not arguing these figures will automatically make somebody richer than someone previously earning less than them before. I'm arguing more for the fact that such high taxation is a negative reinforcement for hard work and if taxation gets too high it can threatens the principles of capitalism.
    I think both of those claims you're making are true btw. " I'm arguing more for the fact that such high taxation is a negative reinforcement for hard work and if taxation gets too high it can threatens the principles of capitalism. "

    I just don't think in our society, the UK, with our tax rates, spending habits, tax elasticity, that a) the negative reinforcement on hard work causes a greater loss to Quaityoflife than the increase in welfare and other things that the higher tax allows and b) that the taxation is therefore too high and thus threatens the principles of capitalism.

    Careful not to assume though that our society is founded on principles of capitalism. Pretty sure it isn't and we don't want that to be our base justification for the laws we bring in.
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    (Original post by TorpidPhil)
    I think both of those claims you're making are true btw. " I'm arguing more for the fact that such high taxation is a negative reinforcement for hard work and if taxation gets too high it can threatens the principles of capitalism. "

    I just don't think in our society, the UK, with our tax rates, spending habits, tax elasticity, that a) the negative reinforcement on hard work causes a greater loss to Quaityoflife than the increase in welfare and other things that the higher tax allows and b) that the taxation is therefore too high and thus threatens the principles of capitalism.

    Careful not to assume though that our society is founded on principles of capitalism. Pretty sure it isn't and we don't want that to be our base justification for the laws we bring in.
    I do agree, although being a personal supporter of the principles of capitalism. However I'm focusing on the lefts idea of taxation much higher than current rates, as I mentioned in the first post.
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    (Original post by Drewski)
    No you're not. Not always.

    If you earn £1 under the threshold and get taxed at one rate but someone else gets paid £1 over the threshold and gets taxed at another rate, you'll be substantially better off than them after tax has been removed.
    You have no idea how taxation works in this country :rofl:
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    Given how we're having to make cuts to certain services, an increase in tax on the rich makes sense. But I'd only argue for a reasonable rise, nothing drastic. It wouldn't really hurt them and would ease pressure on the rest of the population. We're all supposed to be in this together aren't we?
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    (Original post by Lord Samosa)
    Given how we're having to make cuts to certain services, an increase in tax on the rich makes sense. But I'd only argue for a reasonable rise, nothing drastic. It wouldn't really hurt them and would ease pressure on the rest of the population. We're all supposed to be in this together aren't we?
    I'm interested in knowing what your idea of a "reasonable rise" is. Income tax is already very high in the U.K. and it could be argued if it increases more, consequently, there may be an increase in white collar crime and decrease in work ethic. But of course the extent of that depends on the rise.
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    (Original post by TheBirdman)
    I'm interested in knowing what your idea of a "reasonable rise" is. Income tax is already very high in the U.K. and it could be argued if it increases more, consequently, there may be an increase in white collar crime and decrease in work ethic. But of course the extent of that depends on the rise.
    It's 45% now, I would say 50% is the absolute maximum. So anywhere in between 45-50%.
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    (Original post by Lord Samosa)
    It's 45% now, I would say 50% is the absolute maximum. So anywhere in between 45-50%.
    If increased then to 50% would this realistically have a large enough affect to improve services such as the NHS. Especially as you say between 45-50% meaning you're essentially saying you may barely increase them at all, in which case what's the point? Lower taxation tends to lead to more jobs and economic growth with more revenue in the long run.
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    (Original post by TimGB)
    Basically the aim of taxation is to take money from those who don't need it and to redistribute it to people or important projects that do, while making sure that richer people are still richer people. Higher tax rates on the rich means taking more money from those with little need for it, and thus being able to allocate more money towards welfare. There's not much of an ethical problem with this, however if you go overboard you'll get rich people moving abroad, which is not too good for our economy.
    Thing is a lot of people who fall into higher tax bands are actually poor/working-class e.g. someone earning 50-60k in London would still be working-poor (can't buy a house etc) but would be paying upper tax band.
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    (Original post by TorpidPhil)
    A high quantity of jobs perhaps, but just like the pounds we spend, not all jobs are equally valuable. A society would be totally functional without any... circus performers, more or less despite them contributing to GDP. If you replaced them all with lower paying retail workers GDP may decrease but quality of life increase. Soldiers are an excellent example. Generally more valuable to society than their wage indicates. People wise at gambling less so. They earn a lot but for doing no real benefit to society.
    That's true but unfortunately people are not taxed based on what they do. i'd love a system that taxes doctors, engineers etc 10% but taxes the hell out of bankers.
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    (Original post by Lord Samosa)
    You have no idea how taxation works in this country :rofl:
    Having re-read what I wrote, I'm not at all surprised someone has said that. Even I don't agree with it.
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    (Original post by TheBirdman)
    Couldn't it be argued that with the current highest taxation rate being at 45%, essentially almost half, there is still the ethical problem of taking away a large amount of money from those who've often succeeded. It may not affect the incredibly wealthy but for those earning just over £150,000 it is a substantial amount.
    Top rate is between 100 and 100k+2x personal allowance, ignoring spikes where it is effectively thousands of percent, so highest sustained.

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    (Original post by el0hssa)
    That's true but unfortunately people are not taxed based on what they do. i'd love a system that taxes doctors, engineers etc 10% but taxes the hell out of bankers.
    Ah, envy how I have missed you

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    (Original post by Lord Samosa)
    It's 45% now, I would say 50% is the absolute maximum. So anywhere in between 45-50%.
    Which would increase income tax receipt by less than 1%, suddenly that avoidance people like complaining about when other people do it goes up

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    High taxation in a capitalist system is difficult to maintain. The effective rate at which rich people actually pay tax is quite low because of tax planning and such.

    The left in the context of capitalism can only challenge the amount of tax paid by rich people. They cannot challenge the existence of rich people. They will invoke moral arguments etc etc but at the end of the day all the significant means of production need to be owned by society and then society can allocate resources as they wish. Then from there, the only way to increase the resources that you have at your disposal is to increase productivity.

    The laffer curve is an illustration of what will happen if you tax rich people in capitalism. They will run away when the rate is too high. The laffer curve based on the assumption that rich people are responsible for all the wealth and income they have when in reality it is the workers.

    If people do not have the necessary philosophical foundations a tax system will always be resisted.
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    For those talking about England having a progressive tax system you could argue that is not the case. Though we have a progressive personal income system allot of the others are regressive and actually bring us back to a near regressive tax system e.g. VAT, national insurance (not technically a tax but still), council tax and excise duty. So surely a care can be made for increasing the top tax rate to cover for the regressive nature of other taxes?


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    (Original post by Seale321)
    For those talking about England having a progressive tax system you could argue that is not the case. Though we have a progressive personal income system allot of the others are regressive and actually bring us back to a near regressive tax system e.g. VAT, national insurance (not technically a tax but still), council tax and excise duty. So surely a care can be made for increasing the top tax rate to cover for the regressive nature of other taxes?


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    I myself vehemently oppose VAT.

    A sneaky means to tax the poor more than everyone else as a percentage of their income. Inexcusable and I don't think too good for the economy.
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    (Original post by Lord Samosa)
    We're all supposed to be in this together aren't we?
    Not since Thatcher made it acceptable to be selfish 😂


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