Starmer's vision quest

[Bazzer]

According to Google, the highest rate has been as high as 94%, in the period since 1945, but, as I said elsewhere, I never reached such earnings heights, in the relevant period, so, I don't recall it..

Another factor IMHO if talking of Income Tax is EE NI, this, to all intents and purposes is an income tax, in addition to what is referred to as Income Tax.

There is also of course the "indirect" taxes, very difficult to work out a meaningful figure, I suppose, but, if we take into account Insurance premium tax, council tax, fuel duty, VAT etc etc, what % of an average earners income goes to the Government?

A higher rate of income tax may have been imposed prior to the 1970's, but there appeared to be a bit of a fixation with the tax rates of the period. Yes they were extremely high for some and large numbers of those taxpayers found ways around of not paying what the Government intended. But a simple comparison of rates misses completely underlying information.

 

[BoldonLad]

A higher rate of income tax may have been imposed prior to the 1970's, but there appeared to be (1) a bit of a fixation with the tax rates of the period. Yes they were extremely high for some and (2) large numbers of those taxpayers found ways around of not paying what the Government intended. (3) But a simple comparison of rates misses completely underlying information.

(1) Don't think it is a fixation, simply referring back to a period of poor performance of the economy, and, Government (both Labour and Conservative) tax policies at the time.

(2) Which supports the observation that high tax rates lead to increased avoidance.

(3) I don't disagree that simple comparisons are not meaningful, there are other factors to consider, not least of which are allowances, and benefits in kind, which you have mentioned.

 

[Ian H]

You mention 99%, but as I recall, when they reached peak leftiebollox in the 70's the top rate of income tax was 82% and there was a 15% surcharge for unearned income, making the top rate 98%. They then wondered why people were ****ing off and why they needed a bail out. I'm not suggesting that the current lot will go that far, but just goes to show when it comes to tax that lefties don't learn 🙂

Here's a more financially literate explanation.
The 1976 sterling crisis was a currency crisis in the United Kingdom. Inflation (at close to 25% in 1975, causing high bond yields and borrowing costs), a balance-of-payments deficit, a public-spending deficit, and the 1973 oil crisis were contributors.[1]

The origins of the crisis have been attributed to the 1972 Conservative "spend for growth" budget initiating the inflation cycle.
https://en.wikipedia.org/wiki/1976_sterling_crisis

 

[Pblakeney]

A case for Regional Income tax, or, a case to move house? 😂

Nah. It's a choice of prime postcode and less cash or less desirable postcode and loads of money.
You takes your pick of image or substance.

 

[Stevo 666]

Here's a more financially literate explanation.
The 1976 sterling crisis was a currency crisis in the United Kingdom. Inflation (at close to 25% in 1975, causing high bond yields and borrowing costs), a balance-of-payments deficit, a public-spending deficit, and the 1973 oil crisis were contributors.[1]

The origins of the crisis have been attributed to the 1972 Conservative "spend for growth" budget initiating the inflation cycle.
https://en.wikipedia.org/wiki/1976_sterling_crisis

A more financially literate explanation for what, exactly?

 

[BoldonLad]

From Labour's 2024 Manifesto (https://labour.org.uk/change/strong-foundations/)

The commitment is "Labour will not increase taxes on working people" next bit clarifies the commitment being the reason for other intended stuff.

To my mind freezing the income tax threshold would be increase taxes on working people.

Now they're trying to weazel out of it with eg"we said we wouldn't raise the headline rate ..." ... no, they said "Labour will not increase taxes on working people.

Ian

Does the “working people” promise exclude other tax increases, on items which “working people” buy or have to pay including for example council tax.

 

[Stevo 666]

Does the “working people” promise exclude other tax increases, on items which “working people” buy or have to pay including for example council tax.

It probably depends on what definition Labour is using of 'working people' on any particular day.

 

[CXRAndy]

View: https://x.com/CPhilpOfficial/status/1944804117815136336?t=XnW_UVYR7BWDEWX1c2LoMA&s=19

 

[Bromptonaut]

Pound to a pinch of peppermint Philp isn't telling the whole story.

 

[First Aspect]

It probably depends on what definition Labour is using of 'working people' on any particular day.

As yet it's just the Torygraph and the Hate Mail that have been speculating.

What irritates me is that Labour have basically said nothing and yet again. are constantly teasing with policy, which is the best way to cause maximum damage when they finally notionally insert "class" between "working" and "people".

While they dither, everyone with actual money to spend isn't spending it, because they are worried that their 40-50 hour weeks don't qualify as "working".

 

[Stevo 666]

As yet it's just the Torygraph and the Hate Mail that have been speculating.

What irritates me is that Labour have basically said nothing and yet again. are constantly teasing with policy, which is the best way to cause maximum damage when they finally notionally insert "class" between "working" and "people".

While they dither, everyone with actual money to spend isn't spending it, because they are worried that their 40-50 hour weeks don't qualify as "working".

The latest reference by a Labour minister refers to 'people on modest incomes', which potentially puts a significant proportion of the population in the cross hairs.

 

[First Aspect]

The latest reference by a Labour minister refers to 'people on modest incomes', which potentially puts a significant proportion of the population in the cross hairs.

It would be electoral suicide, because the laying the blame on the Tories grace period is coming to an end.

I am still betting in threshold freeze until the end of the century, and being told it's not a tax rise, honest.

 

[Bazzer]

(2) Which supports the observation that high tax rates lead to increased avoidance.

The high tax rates of the mid to late 1970s may have spawned the tax avoidance industry through companies like Rossminster, but avoidance by the wealthy was around for decades before then. For example the Duke of Westminster, or the egregious activities of the Vesty family.
But as Income Tax rates, particularly for the wealthy, fell with Thatcher and subsequent governments, avoidance didn't fall, it grew. That growth was fuelled not by tax rates, but by companies earning large sums of money from devising schemes which could be mass marketed to all groups of earners; from multimillionaire business owners to factory workers. Neither was it restricted to Income Tax. VAT, Corporation Tax, National Insurance, CGT and Stamp Duty were all attacked.
What has changed is;
a) Governments being more proactive in tackling avoidance, whether this be with the introduction of broader legislation such as the Disclosure of Tax Avoidance Scheme (DOTAS), or the introduction of specific legislation to block loopholes that were being exploited.
b) The Court's view of the transactions which form the avoidance schemes.

 

[Ian H]

It would be electoral suicide, because the laying the blame on the Tories grace period is coming to an end.

I am still betting in threshold freeze until the end of the century, and being told it's not a tax rise, honest.

A Labour minister has not ruled out a wealth tax – but said taxes will not be raised for people with 'modest incomes'

 

[First Aspect]

A Labour minister has not ruled out a wealth tax – but said taxes will not be raised for people with 'modest incomes'

It's just total horseshit isn't it.

It's also not saying anything at all about taxes other than the wealth tax that they won't apply, for people not deemed to be on modest incomes.