More blinding innumeracy in The Guardian

Note the new corporate tax rate of what is in effect 8% for UK-based multinationals which means, incredibly, that multimillion-pound concerns will pay less tax than people earning £7,500 a year.

No love, it means that multi-nationals will be paying a lower tax rate than people earning £7,500 a year.

And if we want to get complicated we would say that the corporation will be paying a lower marginal tax rate, a higher average tax rate, and all of this only on money that is offshore and remains offshore. Money that is brought in to pay out to shareholders as dividends will still be taxed at 24%: which is, as you\’ll note, higher than the 20% rate applied to lower rate income tax payers. And higher rate taxpayers will still pay the higher income tax rate on those dividends they receive.

4 thoughts on “More blinding innumeracy in The Guardian”

  1. “the 20% rate applied to lower rate income tax payers”

    Iz you having a larf? The true rate is somewhere between 50% and 100%, depending on how you calculate it.

    And the 8% rate is of course nonsense as well, complete lie, if you pay interest offshore to a tax haven country, then there’s 20% withholding tax anyway, which is gone for good.

  2. I hate to be pedantic, but should point out that we no longer tax companies on most dividends received (whether from other UK companies or from overseas). This was effective from
    July 2009. The effective exemption puts the UK on the same footing as most other major competitors, the US being an exception.

  3. Totally missing the point that taxing someone on £7,500 pa is bordering on criminal anyway, even an 18yo on minimum wage earns that.

Leave a Reply

Your email address will not be published. Required fields are marked *