Make the rich pay!

But who are these rich who should pay?

The economists reckon (based on tax-filing data) that an income of around $107,540, excluding realised capital gains, puts an American household in the top 10% of American families. To get into the top 5%, you need to earn less than $150,000. To me, it\’s something of a wake-up-call to realise that a couple who make $75,000 each are in the top 5% of American households.

Well, actually, two New York City teachers in a household, each with a modicum of qualifications and tenure, would be those rich who should be paying for everything.

Which isn\’t really what people think they\’re saying when they do say that the rich should pay for it all, is it?

15 thoughts on “Make the rich pay!”

  1. So each super tax payer will support 19 other families. Guessing that a tax on top of the taxes yields a max of about 5% of gross income, that means that each recipient gets about $8 per week. Scratch card money, really.

  2. The old story – whip up the mob with calls for taxing the rich, then the state finds out there aren’t very many of them, so then the ‘kulakisation’ begins on anyone who is even moderately successful.

    You end up with a rate of 70-80% on the ‘top’ rate of tax, i.e. over £38,000. These will be “the rich”, people who may not even be able to buy a flat.

  3. The basic rule of populist taxation is that ‘the rich’ earn about 25-50% more than you do. That gives you a bit of wiggle room if you get that promotion you’ve been hoping for. However everyone above that figure is fair game for paying for everything.

    Thus to a cleaner on minimum wage, anyone earning £25K is ‘rich’ and therefore should be taxed more, whereas to Polly Toynbee its the multimillion pound incomes that are ‘obscene’ and should be removed by taxation (cos she earns less than that).

    Simple really. Tax should always be paid by someone else, not me!!

  4. “then the state finds out there aren’t very many of them”

    Well that’s pretty much the definition of ‘rich’ isn’t it?

  5. The UK high rate tax starts at £37,400, covering such “rich” earners as Police Sergeant and Junior Doctor. Even an 18yo on minimum wage pays tax in the UK, that’s bloody disgraceful. And even with all this tax the government still has to borrow to cover expenses!

  6. The more who pay tax, the better. Otherwise you have half of the population voting for spending they never have to pay for.

  7. You end up with a rate of 70-80% on the ‘top’ rate of tax

    Pre-Thatcher, didn’t the top UK marginal tax rate top out at something like 97%? (On a much higher threshold of course). I can’t remember the details, but wasn’t it Geoffrey Robertson who wanted a famous artist or writer to testify on one of his obscenity defenses but he/she couldn’t appear in person because it would trigger this ridiculous tax as I recall . Yep , good for society.

  8. “The UK high rate tax starts at £37,400?: no it doesn’t.

    Who to believe, dearieme or the HMRC website ?

    Both. The higher rate kicks in at £37,400+personal allowance.

    Even an 18yo on minimum wage pays tax in the UK, that’s bloody disgraceful.

    I used to agree with this, however…

    Otherwise you have half of the population voting for spending they never have to pay for.

    I now think this is more important. If we are to have an income tax, I think it should be a completely flat rate with no allowances, credits or deductions.

  9. I don’t think you can have a completely flat tax without a CBI. And a CBI is horribly expensive. I favour a large exemption and then a flat tax on the remainder (and this would mean scrapping most other taxes, i.e. capital gains, NI, corporationtax, most luxury taxes, airport duty etc.) There’d be room for a sales tax on top (but not VAT!). Taxation t as a function of income i with a threshold h and a rate r would basically be:

    t(i) =
    {0, i ≤ h
    {r(i – h), i > h

    That would make income tax forms a lot simpler.

  10. David, with my flat rate income tax I would have a CBI as well. The CBI could be expensive or cheap, depending upon the level it is set at, but if set at r*h in your example, it would be no more expensive than the exemption/personal allowance + means tested benefits we already pay. The advantage of a completely flat rate is even less admin overhead, as the tax due on each income payment can easily be calculated without requiring any knowledge of any other income paid to that person in the current tax year. This could be useful for those who have multiple jobs, irregular shift work, freelance work, etc.

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