Why overtaxing the rich is wrong

I think this is where the whole argument falls down. Assuming people who earn over £45k "have plenty" is flawed. People, with any sense, live within their means. Someone earning £45k plus will no doubt buy a bigger house than average - built by people in the building trade no doubt. They may drive a bigger car - built by people in the motor trade. They may hire a cleaner to look after their house = more money into UK PLC. In short their outgoings may well be in line with their income.

Simply taking the money from them might actually be short sighted. They are paying more then someone on £25k anyway, percentages take care of that.

It's a complex argument and in my view can't be polarised as taking money off rich people or people who can afford it.
d
agreed and you have a valid point. people whom earn more tend to have out goings that par there earnings.
the situation of things from all areas from cars to £10 cups of tea has created such a gulf that within a world we have many worlds all saying we live on one world. so when we actually think seriously about this we see a major problem.
 
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Stephen Berry

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Jan 3, 2007
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[FONT='Times New Roman','serif']THE TAX SYSTEM EXPLAINED IN BEER

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100.
If they paid their bill the way we pay our taxes, it would go something like this...

The first four men (the poorest) would pay nothing
The fifth would pay $1
The sixth would pay $3
The seventh would pay $7
The eighth would pay $12
The ninth would pay $18
The tenth man (the richest) would pay $59

So, that's what they decided to do.

The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve ball. "Since you are all such good customers," he said, "I'm going to reduce the cost of your daily beer by $20". Drinks for the ten men would now cost just $80.

The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still drink for free. But what about the other six men ? How could they divide the $20 windfall so that everyone would get his fair share?

They realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer.

So, the bar owner suggested that it would be fair to reduce each man's bill by a higher percentage the poorer he was, to follow the principle of the tax system they had been using, and he proceeded to work out the amounts he suggested that each should now pay.

And so the fifth man, like the first four, now paid nothing (100% saving).
The sixth now paid $2 instead of $3 (33% saving).
The seventh now paid $5 instead of $7 (28% saving).
The eighth now paid $9 instead of $12 (25% saving).
The ninth now paid $14 instead of $18 (22% saving).
The tenth now paid $49 instead of $59 (16% saving).

Each of the six was better off than before. And the first four continued to drink for free. But, once outside the bar, the men began to compare their savings.

"I only got a dollar out of the $20 saving," declared the sixth man. He pointed to the tenth man, "but he got $10!"

"Yeah, that's right," exclaimed the fifth man. "I only saved a dollar too. It's unfair that he got ten times more benefit than me!"

"That's true!" shouted the seventh man. "Why should he get $10 back, when I got only $2? The wealthy get all the breaks!"

"Wait a minute," yelled the first four men in unison, "we didn't get anything at all. This new tax system exploits the poor!"

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks so the nine sat down and had their beers without him. But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

And that, boys and girls, journalists and government ministers, is how our tax system works. The people who already pay the highest taxes will naturally get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas, where the atmosphere is somewhat friendlier.

David R. Kamerschen, Ph.D.
Professor of Economics.

For those who understand, no explanation is needed.
For those who do not understand, no explanation is possible

[/FONT]
 
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so really what we are saying is that the problem isnt the poor.its those in the middle.
which to my mind is mostly correct.
wealthy people dont moan about the poor ,its those in the middle that moan the most imo.
the wannabies
 
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so really what we are saying is that the problem isnt the poor.its those in the middle.
which to my mind is mostly correct.
wealthy people dont moan about the poor ,its those in the middle that moan the most imo.
the wannabies.
i keep adding here.
the threat of going over seas whilst i agree is real but also feel is not to realistic for the most part.people seem to under estimate this country and its ability to work hard dig in and make it what it is. today ive seen something ive not seen in this country for a long time and that is the proudness and a togetherness of being english.any country watching ours today will look in ore . the people made this day what it has been with the exceptence of what we have been, of what we are and what we can be .its up to EVERYONE to make it work .give a little to gain much. a happy people is a happy home and a productive home. its basic human science
 
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so really what we are saying is that the problem isnt the poor.its those in the middle.
which to my mind is mostly correct.
wealthy people dont moan about the poor ,its those in the middle that moan the most imo.
the wannabies.
i keep adding here.
the threat of going over seas whilst i agree is real but also feel is not to realistic for the most part.people seem to under estimate this country and its ability to work hard dig in and make it what it is. today ive seen something ive not seen in this country for a long time and that is the proudness and a togetherness of being english.any country watching ours today will look in ore . the people made this day what it has been with the exceptence of what we have been, of what we are and what we can be .its up to EVERYONE to make it work .give a little to gain much. a happy people is a happy home and a productive home. its basic human science

Wake up

Those in the middle what is the majority by far are getting squeezed. Only an very very small % will progress to what ever rich is.

Therefore, those in the middle risking everything are being asked to support the country?

I can tell you that is getting harder by the week so people like me who will always be in the middle will invest not in UK but elsewhere.

When this becomes as it will a serious trend the UK will have even more serious problems than now, And it is already very very serious.

Dream on if you do not think small business cannot rapidly move overseas.
 
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Dream on if you do not think small business cannot rapidly move overseas.

Most small businesses can't go abroad though. If you're providing a physical product/service you're stuck there. Then a lot of small business owners have family ties in UK, language barriers, kids in school, etc etc. Nearly every small business owner is going to have to just accept whatever tax rates are forced on them - they're not going anywhere.

These are the people you need to tax - the ones who've no choice but to take it. They can't up sticks and leave.
 
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Most small businesses can't go abroad though. If you're providing a physical product/service you're stuck there. Then a lot of small business owners have family ties in UK, language barriers, kids in school, etc etc. Nearly every small business owner is going to have to just accept whatever tax rates are forced on them - they're not going anywhere.

These are the people you need to tax - the ones who've no choice but to take it. They can't up sticks and leave.

Totally agree but then there is a huge amount that can and more importantly new businesses that are opening are thinking different.

By the way I provide a physical service/product and when I opened 8 years ago I was stuck here and I am still here but I also operate in many more countries and believe me I do not accept tax rates that are force on me.

Not for every business of course, but common to much negative rather than positive. The UK has a history like no other country in the world businesses should be riding those coat tails as they are on the way out. It is only going to get harder.
 
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Totally agree but then there is a huge amount that can and more importantly new businesses that are opening are thinking different.

By the way I provide a physical service/product and when I opened 8 years ago I was stuck here and I am still here but I also operate in many more countries and believe me I do not accept tax rates that are force on me.

Not for every business of course, but common to much negative rather than positive. The UK has a history like no other country in the world businesses should be riding those coat tails as they are on the way out. It is only going to get harder.

From the username I'm assuming some sort of adventure holidays? If thats right then you have considerably more freedom to move around than a butcher, baker or candle stick maker - they just need to accept whats given to the m on the tax front.
 
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From the username I'm assuming some sort of adventure holidays? If thats right then you have considerably more freedom to move around than a butcher, baker or candle stick maker - they just need to accept whats given to the m on the tax front.

Assumptions are interesting but often wrong. Each day I have to kick myself for making them.

I make income from over many different streams and my passion, adventure is just one. Others include , retail, food, bars, transport, finance, and so on.

Life is to short to be bored.
 
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andygambles

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Jun 17, 2009
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It seems that an edit of the thread title is needed. The discussion doesn't seem to be about the 'rich' more about those who earn enough to pay their own way in the world.

Which is a very good point.

I live in a modest 3 bed semi. Drive a modest car (Zafira) have 3 kids yet pay 40% tax.

Yes I can afford a few luxuries like a nice TV, a few holidays a year (talking UK not flash foreign trips). My kids have a few luxuries as well like ipods, laptop etc.

However I seem no better off than the family round the corner who both do not have jobs. They have 5 kids so have a 6 bedroom detached house with a large garden. They have Sky, Xbox, PS3, Ipods, pretty much all the same as me. But all paid for by the council and benefits.

Where does that come from? Probably the £16.5k in tax I paid last year.

But then apparently I am rich.
 
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Wake up

Those in the middle what is the majority by far are getting squeezed. Only an very very small % will progress to what ever rich is.

Therefore, those in the middle risking everything are being asked to support the country?

I can tell you that is getting harder by the week so people like me who will always be in the middle will invest not in UK but elsewhere.

When this becomes as it will a serious trend the UK will have even more serious problems than now, And it is already very very serious.

Dream on if you do not think small business cannot rapidly move overseas.

and when you do bugger off abroad those left behind will fill your shoes and move from the lower middle to the middle..


theres an old saying in foootball no one player is bigger than the club...
if im led to believe that all middle investors will move abroad then
1 i dont believe it
2 theres plenty of talent and skill here to replace you
so you dream on if you think this country needs everything you have..
there are plenty of very verey talented indaviduals working for talented individuals that can fill boots if the need comes
 
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Which is a very good point.

I live in a modest 3 bed semi. Drive a modest car (Zafira) have 3 kids yet pay 40% tax.

Yes I can afford a few luxuries like a nice TV, a few holidays a year (talking UK not flash foreign trips). My kids have a few luxuries as well like ipods, laptop etc.

However I seem no better off than the family round the corner who both do not have jobs. They have 5 kids so have a 6 bedroom detached house with a large garden. They have Sky, Xbox, PS3, Ipods, pretty much all the same as me. But all paid for by the council and benefits.

Where does that come from? Probably the £16.5k in tax I paid last year.

But then apparently I am rich.

show me these people...........
show how much the same you are...........
 
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andygambles

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Jun 17, 2009
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show me these people...........
show how much the same you are...........

I am not saying they are the same. I also do not dispute I am actually better off than them.

What I am trying to say is that when you start paying higher rate tax and see how much you are paying you start to see the world differently.

You start to be cynical of those who live off benefits. Rightly or wrongly it becomes hard not to look at some people as spongers and start to think what I could do with that money to help much more deserving people than how it is currently used.

I accept that this is in some way my own failing. By it becomes harder to have a balanced view as the tax begins to bite.

It is, in my opinion, the unfair tax system that is creating a class divide rather than closing it.
 
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I am not saying they are the same. I also do not dispute I am actually better off than them.

What I am trying to say is that when you start paying higher rate tax and see how much you are paying you start to see the world differently.

You start to be cynical of those who live off benefits. Rightly or wrongly it becomes hard not to look at some people as spongers and start to think what I could do with that money to help much more deserving people than how it is currently used.

I accept that this is in some way my own failing. By it becomes harder to have a balanced view as the tax begins to bite.

It is, in my opinion, the unfair tax system that is creating a class divide rather than closing it.
whilst i understand what you say,the reality is we need dolies a fors the jobs dolies create ..no dolies no job centers no low wages no many other jobs that exsist from there being dolies.

of the many dolies there are a minority that really dont want to work.which is something that will always be there ... i doubt your tax would change if the few that dont want to work suddenly started working.
 
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Podge

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Jan 13, 2011
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I am not saying they are the same. I also do not dispute I am actually better off than them.

What I am trying to say is that when you start paying higher rate tax and see how much you are paying you start to see the world differently.

You start to be cynical of those who live off benefits. Rightly or wrongly it becomes hard not to look at some people as spongers and start to think what I could do with that money to help much more deserving people than how it is currently used.

I accept that this is in some way my own failing. By it becomes harder to have a balanced view as the tax begins to bite.

It is, in my opinion, the unfair tax system that is creating a class divide rather than closing it.

You will never have a ballanced view while comparing your situation with the headline grabbing few rather than the genuine cases.
 
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This is half of the problem.
It puts people off paying tax when they see the way people manage without lifting a finger.



dont then.dont work ...dont pay tax ,dont do anything...

ive paid shed loads of tax...i dont care where it goes ...i dont care if some goes to dolies or if some goes to hospitals or what ever. it makes no difference where it goes ..you will always pay it regardless...
 
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OptiRick

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Jun 4, 2010
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dont then.dont work ...dont pay tax ,dont do anything...

ive paid shed loads of tax...i dont care where it goes ...i dont care if some goes to dolies or if some goes to hospitals or what ever. it makes no difference where it goes ..you will always pay it regardless...

What a silly attitude.

I take it you won't mind if your tax is doubled?
 
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What a silly attitude.

I take it you won't mind if your tax is doubled?

It's not siilly though is it. A point i tried to make a while ago is we really don't have a say where the money is spent. We are non the wiser that people in the MOD think lightbulbs are a bargain at 22 quid.

Ofcourse we would mind if taxes went up, but they won't ever go up that much. And if they did the government at the time would get no votes.

You have a far better life not worrying about what the government do with money that you have to pay regardless and have no say in what it is used for.

We keep hearing "look what they are doing with your money". I have never classed it as my money because i did not give it to them, they take it regardless.
 
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It puts people off paying tax when they see the way people manage without lifting a finger.
How many times do we have to listen to that misleading, cliched and probably apocryphal story?

The fact is that we have a benefit system. As a result of this benefit system people who in need of it are awarded some benefits. I have heard dozens of stories (in this forum alone) of people are awarded £500 or £600 per week in benefits for them and their 12 children (and presumably go around seeking out small business people to reveal how much benefit they are receiving).

They live the life of Reilly on this, they have a nice car and take holidays abroad. And then we have the others who refuse to take jobs because they get enough on the dole to take two holidays a year and buy 42" tellys and all manner of luxury goods. What about the others who have not worked for 20 years and who spend every night in the pub drinking cider?

I live in a very deprived area with high unemployment and I frequent the local hostelries. You would think that I would have met some of these people in my area wouldn't you? But no, I have never come across any of them. Where are they all? The vast majority of the ones I know that are on benefits don't have any of these things. They don't starve and they have a roof over their heads but they live a life of struggle to afford most of the things we all take for granted. That is the reality for the vast majority of people on benefits.

I am not denying that there are isolated cases of people on the dole who seem to be doing well but there are benefit cheats who work on the side or have other income that they do not declare. They are most certainly not typical.
 
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Getting back to the subject of tax and "overtaxing the rich", in my experience there does not seem to be any shortage of "rich" people who are willing to evade tax at every opportunity. I would be willing to bet that a few of those who are complaining in here offer "VAT free prices" in alternative quotes and use other "opportunities" to avoid and evade tax.
 
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L

Lee Jones Jnr

Getting back to the subject of tax and "overtaxing the rich", in my experience there does not seem to be any shortage of "rich" people who are willing to evade tax at every opportunity. I would be willing to bet that a few of those who are complaining in here offer "VAT free prices" in alternative quotes and use other "opportunities" to avoid and evade tax.

What exactly is the problem with tax avoidance? Perhaps you should reevaluate the effectiveness of your accountant?
 
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If you prefer to pay lower taxes then you can move to a country without a social system, like USA. I've heard stories about people who are terminally ill in the USA, who end up in millions of dollars of debt because they have to pay for their medical bills. I don't want to live in a country where people have to die because they cannot afford to pay for their medical bills.
Let's dispel rumours and hearsay, shall we?

- About a third of the number quoted as being without medical insurance in the US are illegal immigrants.

- Those without medical insurance usually go to the emergency room of a hospital, where they won't be turned away. Indeed, this is the biggest problem with the current system, because ER wasn't designed for this.

- Within 30 minutes of where I live, for example, there are at least four hospitals that perform heart transplants with a very short waiting list. In other words, competition in the provision of healthcare service leads to far better service.

- My two older children both work in US hospitals, so my comments are based on fact, not "I've heard stories". I've heard stories that Martians live among us.
 
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I'll tell you my story and if you can, tell me what I should be doing that I'm not....So what should I be doing? If you were in my position what would you do to try and find work with the skills I have?
Sorry it took me a while to respond, but I've had very little access to the Internet these last few days.

When you visit a company, how much research do you perform in advance? Do you study their website, search the Internet for customer comments, visit them ahead of time as a potential customer, speak with people in town to get a sense of their reputation, study their financials to know how much cash they have, how much they are growing, where they hope to expand, learn the names of the key company officers, and so on? Good sales people get up early every day to do this so they understand a potential customer's needs before considering how their products could best meet those needs. As someone looking for work, you too are a salesman: You are selling your services.

I'm making up a scenario to try to make the point. Let's say that you seek a job advertised at a local bookstore. You visit the store to find how it's organized and laid out. Previously, you researched online and found three local colleges whose students need books, but you notice that these books are not available at the bookstore. You talk to some students and find that they pay a very high price for books at a university bookstore (they can't wait for books to arrive from an Internet supplier). Next, from your contacts, you determine that it's possible to get the books at a better price from a little-known supplier overseas. You contact one of the three local colleges, persist on the phone until you track down the decision-maker, and learn that she'd be delighted to have another bookstore set up, free of charge, in some available space in the Student Centre building for two weeks at the beginning of each term. You also learn that new students receive an information packet that lists stores where they can buy books, and your local bookstore is not on the list. None of the advertisers on that list offer any kind of loyalty discount, which would attract students. And so on, and so on.

What have you done?

- Learned about the store and how it could improve
- Learned about a real need that the store could meet
- Used your contacts to find a cheaper source of books
- Demonstrated your initiative by contacting a college and relevant decision-makers
- Learned new ways in which the bookstore could reach customers who are guaranteed to spend money
- Delivered value to the store owner before you ever walk in for an interview

If the bookstore has been bombarded with 200 CVs from local candidates, all in the same format and with the same content as sent to 100s of other bookstores, and then you walk into the store with a 2-page idea for generating new revenue based on your personal knowledge and experience, who do you think will get the job?
 
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My two older children both work in US hospitals, so my comments are based on fact, not "I've heard stories".

There are too many verifiable "stories" about the American health system's failings, people who are suffering through lack of medical treatment and insurance companies who will let people die rather than pay out to list here.
 
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