This bit…

From 2011, if Labour win the next election, earnings above £150,000 will be taxed at a new higher rate of 45 per cent. The new higher rate of tax – the first income tax increase in decades – will raise £670m a year.

Trivial….the politics of envy, no more. At current rates of spending this is something like 0.1% (yes, one tenth of one percent) of the total tax take. Meat for the success hating classes, nothing else.

Mr Darling\’s tax increases will begin in 2010 – before the expected date of the next election – with changes to the tax-free personal allowance. At the moment, no taxpayer has to pay income tax on the first £6,035 of their earnings – a tax saving worth £1,207 per person.

However, from 2010, those earning more than £100,000 will lose half their personal allowance – adding more than £600 to their annual tax bill. Those earning more than £140,000 will not get any tax-free allowance.

This creates a couple of oddities in the marginal rate that (some) people face. But not important ones I think. Dependent upon the details those earning £139,999 and getting a £1 pay rise will see a reduction in take home income. But at that level I don\’t think that anyone does get a £1 pay rise, so I doubt that it\’s of any importance.

 

 

6 comments on “This bit…

  1. There are Afghan chavs (it was in all the press) who live in a house which costs £144 k pa to rent.
    Surely giving them a lot less money would be fairer than raising taxes on people who have less money than them.

  2. Do Captain Darling’s figures include the people who decide that they’d rather just give a lot more of what they earn to charity, or stuff it away in all sorts of non-taxable earning schemes? And how many multimillionaires find their decision of where to live being tipped over to somewhere else as a result of this?

  3. “Meat for the success hating classes, nothing else.”

    One thing else. It forces the Tories to accept it or reverse it – either generates political capital for Labour.

  4. “The new higher rate of tax – the first income tax increase in decades – will raise £670m a year.”

    Only if the folk being persecuted are daft enough to stay here in the UK to be persecuted some more. I have the feeling you don’t get that well paid by being daft.

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