50% tax rate is damaging the economy.

[BrilloPad]

50% income tax affects tax on dividends which come directly from investments. Why should they maintain their UK tax residency when they can fook off to Switzerland and pay almost no tax?

Maybe we should become like the Unites States and tax global income until citizenship revoked?

[AtW]

Maybe we should become like the Unites States and tax global income until citizenship revoked?

I'd agree with that - especially if 15% tax on long term CGT is introduced

[DodgyAgent]

Given the number of arguments in favour of abolishing the 50% band so that business can afford to "pay the best people" and attract "top talent", seeing the same posters argue in favour of not paying the little people more because it's a waste of money is disingenuous. The same logic can be applied to any skillset, however valuable. The fact is some organisations DO pay the little people more in order to attract the best and brightest. Others are happier at the peanut munching simian end of the scale.

The central argument of this lot is that the 50% tax rate is harming the economy because it's harming their business because it means they can't be bothered to work harder and grow the business. I'm sure there are plenty of people who will continue to work their arses off and outcompete them.

FWIW, I would get rid of the 50% tax rate and introduce a proper flat tax. But I still think this is a lot of self interested bollocks.

Two questions

One - who are the "little people" that you talk about?
two - why not make the rate 60% or 70%?

And. The "harder working" competition is more likely to come from abroad where they can keep more of their money without having to work harder.

[DodgyAgent]

I'd agree with that - especially if 15% tax on long term CGT is introduced

And if it was 50%?

[AtW]

And if it was 50%?

As long as firearms for self-defense are tax-deductable it's ok

[SantaClaus]

Maybe we should become like the Unites States and tax global income until citizenship revoked?

In that case, I hereby renounce my citizenship.

I wonder if I can retrospectively renounce it?

[d000hg]

The central argument of this lot is that the 50% tax rate is harming the economy because it's harming their business because it means they can't be bothered to work harder and grow the business. I'm sure there are plenty of people who will continue to work their arses off and outcompete them.

It's nonsense anyway because it's not like it was 20% and suddenly it's 50%... it's gone from 40-50% after the first £100k. Not a big enough change that I would think "oh well I only get 50% not 60% so it's not worth it now".

[Robinho]

It's nonsense anyway because it's not like it was 20% and suddenly it's 50%... it's gone from 40-50% after the first £100k. Not a big enough change that I would think "oh well I only get 50% not 60% so it's not worth it now".

Every % makes a difference. Some people may think that but others will inevitably say **** this and piss of to the Cayman Islands.

[AtW]

It's nonsense anyway because it's not like it was 20% and suddenly it's 50%... it's gone from 40-50% after the first £100k.

It goes up from 40% to around 60% from £100k to I think £110k due to withdrawal of personal allowance which is a really dirty move.

[doodab]

Two questions

One - who are the "little people" that you talk about?
two - why not make the rate 60% or 70%?

And. The "harder working" competition is more likely to come from abroad where they can keep more of their money without having to work harder.

One - The majority of employees are basic rate taxpayers. I used the phrase "little people" because someone else had. The point is the arguments about competition for good people apply at all levels.
Two - I do think there is something fundamentally flawed, unfair if you like, about a marginal tax rate of > 50%.

My point is not that we should keep the 50% rate of tax, because I don't think we should. My point is that their argument for doing away with it is utter cobblers. In fact, I would argue that higher rates of income tax actually encourage investment because they discourage taking profits as income. It certainly works for me. If investing £1500 instead of £3000 on new hardware meant £1500 in my pocket I would have taken it, as it is the difference to my net income is considerably less than that after corporation tax and income tax are accounted for, so investing the money instead makes considerably more sense.

There is some evidence for this in the argument that a 50% tax rate reduces total tax take. Less tax is paid because less income is being taxed because people aren't taking profits as income. If it's not taken as income then it either sits in the company or it's invested.

Also, the 50% tax rate is a temporary state of affairs. By investing that money now instead of taking it as income one can reap the benefits later when the 50% rate is abolished.

Whether this is the best way to encourage investment is a different matter, but it certainly favours investment over profit taking as far as I can see.