What are the chances?

[theEdge]

After reading that front page story, in the Evening Standard last night, about curbing city bonuses, I was wondering what people think the chances are of a new party getting into power and increasing the rate of income tax to 50%.

Who thinks it's likely?

 

[Trader333]

It is already over 50%, we pay more in tax now in real terms than at any time in modern history. The only difference is that you dont see it taken out directly as you would with income tax.


Paul

 

[bizmanny]

They can't make that obviously as to take 50% people will revolt. they might do it but in other ways.

 

[trendie]

Trader333 is right.
Employees have to pay around 11% National Insurance, in addition to the normal Income tax.
VAT is a form of point-of-sale tax, although perhaps fairer.

If tax gets too much, all that will happen is that accountants will become more cleverer as to how income is classed, (as company dividends, etc), or businesses become not worth running.
(skimmed a few articles about mid-70s a while ago, where some top-flight employees were paid in gold coins to avoid tax.) 🙂

 

[in2uxs]

The world is very different now.

The Internet provides a way for the shopper to buy goods from abroad and avoid VAT should VAT get to high. People can salt money away in some far off bank account as easy as two mouse clicks to avoid paying tax on their money. An unfavourable tax say on shares, and share dealers just buy shares in foreign countries, and failing all that if things get too much people just leave the country for warmer climes as moving abroad as never been easier..

People are more savvy to. Government waste years ago was never questioned whereas now it is.

Governments face, in my view, their biggest struggle to date. ... Excellent.

 

[Directional]

you tax at the front and at the back. income tax & NI on earnings, and then 17% VAT on everything you spend. well over 50% goes on tax direct + indirect.

Petrol & diesel is loaded with about 75% tax for every pound you spend

 

[LION63]

It works out that the average UK employee works from January to some date in May just to pay the Inland Revenue (tax and NI), that excludes the effect of VAT. Income Taxes will be raised during the next Parliament under some guise of Green Taxes not to mention a truck load of consumer oriented taxes eg. Flight Taxes; domestic waste levies; car excise duties for bigger cars and 4X4s; road tolls etc.