20 2 mins 8 yrs

Be still my aching sides. Political calamity Labour leader Ed Miliband is making a speech today to try and restore his ailing fortunes after a few weeks of truly horrendous press, as his OWN MP’s plot and brief against him. He will talk about his mission to transform what he labels as  “zero zero Britain” – meaning we have some rich people paying zero tax and some poor people on zero hours contracts. Just a few points to be made here!

1.  The top 1% of top earners contribute around 33% of all income tax. Would Ed like to see them pay EVEN more? Hollande tried that trick in France and look what happened.

2. Labour MP’s seem quite keen on zero hour contracts for their staff so maybe, just maybe, he should chat to them first?

3. This is rank desperation from a politician who is detached from ordinary people, living in his inflated metropolitan bubble. Soaking the wealthy is the oldest socialist trick in the book and he can’t help himself resort to the politics of envy as he desperately hopes to rise above the water level. I forecast he will keep sinking.

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20 thoughts on “ZERO ZERO ED!

  1. Sorry to be off topic but is BBBC down? Whenever I load that site I get this message

    Nothing Found

    Apologies, but no results were found for the requested archive. Perhaps searching will help find a related post.

  2. It’s always useful to read the link:

    Highest paid to contribute almost 30% of all income tax in 2013-14
    Up from just 20% a decade ago as richest shoulder more of the burden

    What that really means is that the rich are getting very much richer. Bear in mind that the rich can afford the accountants who minimse tax and set up avoidance schemes so what’s actually being taxed is only what’s visible:

    http://www.taxjustice.net/cms/upload/pdf/The_Price_of_Offshore_Revisited_Presser_120722.pdf

    $32 trillion hidden away by banks in London, Geneva and new York.

  3. Soaking the wealthy is the oldest socialist trick in the book

    Just as soaking the poor is the oldest Tory trick in the book.

  4. David, what should the tax on the the very wealthy be?

    What rate of tax should apply on salary income or dividends or investment income?

    Lets say you strip out all deductions and have a flat rate. Of what?

    Serious question.

  5. Interesting Spectator piece from Frazer Nelson here

    “It shows that there was already a pronounced marriage gap in 2001, when the figures start, with those in the top category 24 per cent more likely to marry than those at the bottom. That figure now stands at 48 per cent. So a marriage gap that barely existed a generation or two ago has managed to double in the last decade with a minimum of public debate. Somehow marriage, with all the advantages that it confers, is becoming the preserve of the rich.”

  6. Lets say you strip out all deductions and have a flat rate.

    As an accountant I am (sadly) familiar with the UK tax system and its complexities. At present we have the following rates which apply after the £10,000 tax allowance is exceeded:

    10% on interest and dividends for low earners.
    40% on interest and 32.5% on dividends for higher earners
    20% basic rate on income up to £42,000 (not dividends)
    40% higher rate on income between £42,000 – £100,000
    The withdrawal of the £10,000 tax allowance on income between £100,000 – £120,000
    45% on income above £150,000

    And that’s just tax. We also have 12% national insurance on earnings between £8,000 and £42,000 and 2% on anything above that. So the threshold for tax is £2,000 higher than the threshold for national insurance.

    And I will not even mention the myriads of “reliefs” available to reduce taxable income, but rest assured there are dozens. And that does not include the so-called “tax schemes” where income is made to disappear as if by magic. The tax authorities have started all-out war on them, and not before time.

  7. All these systems are unbelievably complex, I would think unnecessarily so.

    I am surprised that things like the flat tax have not gained more support.

    You would think that a strong government led by a popular leader ( say Reagan in his peak ) could deliver something like this, against much opposition from vested interests in real estate, oil industry, charity industrial complex, churches, etc.

  8. I am surprised that things like the flat tax have not gained more support.

    I’m not. Because the losers would outnumber the winners by at least 10:1. And that’s a lot of lost votes.

  9. I’d like to see the numbers on that.

    If the tax rates were lowered in a fewer deduction scheme, I don’t see why this needs to be so.

  10. i believe that, if you want to tackle unemployment, you need to do essentially three things. Lower the operating costs to business (materials, labour and charges), lower the tax burden and, reduce regulation and red tape.

    It is simple, probably too simple. But I believe in it. It’s just a shame that those running the country, who have never run a business, do not seem to see that way.

  11. And maybe reduce the incentives for the work shy to stay on welfare for long periods.

    Take a very close look at those incentives.

  12. I’d like to see the numbers on that.

    Phantom

    The increase in the tax allowance to £10,000 has removed a couple of million from the tax base. They would be caught by a flat tax.

    And the vast majority of taxpayers earn less than £42,000 and so pay basic rate tax @ 20% and probably nic @ 12%. A flat rate % would probably have to be at least 30% with a reduced allowance of maybe £5,000 or so. That means that tens of millions would pay more while the relatively few high earners would be the winners. So it’s politically impossible, unless public spending was cut by at least 20%, also politically iimpossible.

  13. NIC should be abolished and incorporated into general income tax and any and all future tax cuts for the foreseeable future should be entirely directed at lifting the tax threshold as far as possible.

  14. Peter

    A kid with a part time job? Yes. I did when I had a part time job after school.

    An adult who needs to pay rent? No.

  15. any and all future tax cuts for the foreseeable future should be entirely directed at lifting the tax threshold as far as possible.

    This sounds fine in theory, but as the tax base gets ever-narrower, more and more voters will have no skin in the game. That cannot be good for democracy or a cohesive society.

  16. A kid with a part time job? Yes. I did when I had a part time job after school.An adult who needs to pay rent? No.

    So the tax system gets even more complex?

  17. Peter

    Lifting the tax threshold benefits everyone and as long as the government can afford to do it why not ?

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