Where have 70% tax rates worked? In the USA, for a start….
The Spud doesn’t seem to know his history. Nor does the historian:
And here’s the problem. Hauser’s Law. Pretty much whatever anyone does the Federal tax take doesn’t rise above about 20% of GDP. And it’s not true that those high marginal tax rates of the 1950s did much, even anything, to get that tax take up.
There’s a reason why this is true as well. Taxation of incomes isn’t going to get you much more than that.
Manhattan Contrarian recently had a great article that showed how nobody paid the highest marginal tax rate back in the 50s. I’ll try to find the link
https://www.manhattancontrarian.com/blog/2019-1-10-are-there-any-problems-with-a-70-marginal-income-tax-rate
Needless to say, Krugman gets a kicking for his almost criminal dishonesty
The objective of extreme tax rates is to punish the successful, to whack-a-mole anyone who would rise above.
The idea that they are to raise revenue is quaint.
‘Where have 70% tax rates worked?’
They always work.
My question would be – ‘why stop there’ – if 70% is acceptable why not 80, 90, 95?
Of course he is not so stupid (at least unless the great [And seemingly AWOL] Noel Scoper can correct me) as to advocate what he actuallyt wants – the state to determine all resource allocation in totality. Effectively reintroducing, rather than ‘neo-feudalism’ actual feudalism with him no doubt as either King or some kind of very senior noble.
What an utterly repellent piece of garbage he is
Quoth the Tim: “those on less than median incomes shouldn’t see their incomes taxed to pay for the state.”
I disagree – I suspect it’s vital that they pay income tax lest they think everything comes free, and vote to increase income tax with impunity.
The way to shelter them from cold economic winds is to abolish VAT on a wider range of the necessities of life. Which Brexit would enable, would it not?
@ dearieme
VAT is zero on the necessities of life apart from adult clothing. There are a few things *described* as “necessities” that are subject to VAT at 5%
@ dearieme
No-one should be taxed to subsidise those better-off than themselves. Too much of their income tax just goes into “Transfer Payments” – Social Security is nearly 30% of the total spend and while most of that goes to the deserving poor some of it is paid to those with well-above-median incomes (witness Ed Millionaireband’s fury that his barrister mistress would lose her Child Benefit payments under Cameron’s reforms).
The other argument is that it is ludicrous that people earning between £13k and £25k are paying income tax in order to receive income-related benefits.
“I suspect it’s vital that they pay income tax lest they think everything comes free, and vote to increase income tax with impunity.”
Exactly. They need skin in the game. Democracy demands the laws apply the same to everyone, else factions form and government is corrupted.
It infuriates me when politicians speak of the rich and of the poor. All are citizens, and should be treated identically.
dearieme said:
“I suspect it’s vital that they pay income tax lest they think everything comes free, and vote to increase income tax with impunity”
Unfortunately the opposite also happens – there is a lot of “I’m paying my taxes so I should get X from the government, and get it now”.
I’m not sure which is the stronger effect, but I suspect it used to be the former and is now the latter, thanks to Brown’s pushing of ‘entitlements’.
john 77 said:
“VAT is zero on the necessities of life”
Except whisky.
VAT is zero on the necessities of life apart from adult clothing.
Domestic fuel (heating) is taxed at 5%
I suspect it’s vital that they pay income tax lest they think everything comes free, and vote to increase income tax with impunity.
No representation without taxation. No-one should get a vote until they’ve paid into the state more than they’ve received from it. (I reckon I personally passed the cut-off point around the age of 40.)
‘VAT is zero on the necessities of life apart from adult clothing. There are a few things *described* as “necessities” that are subject to VAT at 5%’: right then, we are agreed that there are necessities that could be taxed more lightly. And I assume we are agreed that cutting those taxes would be proportionately more advantageous to those on less than median income?
After that, start chopping the rate of NICs. Even a drop of the employees’ contributions from 12% to 10% would be a help. Perhaps chop council tax a bit too. Pay for all this by chopping various stupid extravagant state expenditures. It’s not very difficult to think of ways of reducing the tax burden on the working poor without exempting them from income tax.
Public Health England
A massive tax cut just waiting to happen.
@ Chris Miller
“No representation without taxation. No-one should get a vote until they’ve paid into the state more than they’ve received from it. (I reckon I personally passed the cut-off point around the age of 40.)”
I read somewhere, and some time ago so it’s probably out of date, that HMGs provision of services is such that the average spend per adult citizen is around £6k.
So anyone contributing less than £6k net in taxes is being subsidised by those who contribute more.
VP
“Of course he is not so stupid (at least unless the great [And seemingly AWOL] Noel Scoper can correct me) as to advocate what he actuallyt wants – the state to determine all resource allocation in totality.”
Murphy might not have gone that far, but he has said he would like HMRC control over, or actually providing, all bank accounts so that tax bills could be a first disbursement from them
Public Health England
A massive tax cut just waiting to happen.
Abolish it, take 20% of the budget and set up a completely new department to focus on communicable diseases and other actual threats to public health. No-one who worked for the previous organisation is permitted to join the new one.
Also, Foreign Aid.
I reckon you are looking at £20bn for both of those, at least.
“No representation without taxation.”
Interesting! I never looked at it turned around before.
“No-one should get a vote until they’ve paid into the state more than they’ve received from it.”
I disagree on a technicality: no one should be receiving anything from the state.
As President, Gamecock would propose an amendment requiring the government make no payments without due consideration. NO MORE WELFARE.* The government could pay soup kitchens for feeding people, but the hungry will receive no direct payments. The government should get something for what it spends. Giving the people’s money away for nothing is wrong.
*Ipso facto, Gamecock will never be President.
@Andrew C
Thanks for that: government spending is currently ~£800 billion on an official (ha!) population of 65 million, so that’s £12k a head. Adults get things like jobseekers and national pension, but children get education, so (to the level of accuracy, I’m looking at) that cancels out.
Half of government expenditure is accounted for by pensions, health, education and defence – what the other half goes on, heaven knows!
https://www.ukpublicspending.co.uk/government_expenditure.html
Gamecock: “The government could pay soup kitchens for feeding people, but the hungry will receive no direct payments”
Unfortunately, as our host has repeated pointed out, the evidence is that giving poor people *money* rather than items is more effective in making poor people not-poor.
Unfortunately, as our host has repeated pointed out, the evidence is that giving poor people *money* rather than items is more effective in making poor people not-poor.
True, but if your goal as a politician is to make as many people dependent on you as possible, then you go with the soup kitchen.
“So anyone contributing less than £6k net in taxes is being subsidised by those who contribute more.”
That would be all tax-like payments – Income tax, national insurance, VAT, a share of contributions to taxable company profits as either an employee or a customer.
It’s not difficult to get to £6000, I think.
An article every “tax the rich” advocate should read:
What the family who pay £500,000 a DAY in tax could teach Corbyn [and Murphy] about helping the poor
“more effective in making poor people not-poor”
Not governments job.
“more effective in making poor people not-poor”
The U.S. has spent $21,000,000,000,000 on the ‘poor’ since Lyndon Johnson. We have the same number of poor – they have NOT been made “not-poor.”
@Chris Miller
I think the (estimate) I read looked only at government spending on actual services that people got (health, roads, police, education and so on) and not money spent wazzing up the wall on failed projects, subsidising the Indian space programme and so on.
But there’s little doubt a huge portion of the population is being heavily subsidised by the rest (28% of income tax paid by highest earning 1%, 90% of income tax paid by highest earning 50%).
And egged on by the likes of that cunt Murphy the ungrateful bastards just whine on about how the rich should be paying even more.
I don’t want to go back to pre-WW1 where the poor had no representation, could be conscripted as it turned out into giving their lives, and had to live under laws they didn’t determine.
Maybe, you know, we could have a two tier system – an election of the common people with a chamber setting the laws, and one for the net contributors of tax with a chamber of these worthy modern day lords setting the budget.
With the Queen ( god bless her ) above both.
@ Bongo
Interesting idea, after three and a half centuries of the HoC being supreme on budgetary matters perhaps it is time to reverse things: purse strings controlled by HoL elected on the no representation without taxation principle, Hoc for the rabble to let off hot air.
@Bongo & DJC
Sounds promising
btw: Local Councils in NI were like that – only Rate Payers had a vote. My father had two votes: one for our house, one for our business; mum had no vote. Seems fair to me.
Then RCs – who mostly lived in no-rates “social housing” – kicked-off and MSM misreported on No Vote – They had vote in General & Stormont Elections
‘And egged on by the likes of that cunt Murphy the ungrateful bastards just whine on about how the rich should be paying even more.’
Yes. Perpetual claims that “the rich don’t pay their fair share.” It is Lefy/CM reliance on the ignorance of the electorate.
When people are surveyed as to what a “fair share” is, they always report substantially LOWER than what the rich are already paying.