oh dear: Shrinking tax base suggests personal allowance is generous enough

[SueEllen]

AtW, as a small business owner with employees who has met the Queen it is your duty to write a letter to the Guardian editor to correct the information.

[Smartie]

Yes, saw that and no comments section available to correct it. Muppets.

[AtW]

At first glance, the latest income tax figures from HMRC make encouraging reading for anyone who believes in equality.

Since 2013/14, around 300,000 people on low incomes no longer pay the 20p basic rate of tax, mostly thanks to the annual increases in the threshold at which people start paying income tax implemented by the previous government and the coalition before it.

At the top end, HMRC expects 364,000 workers to be paying the 45p tax rate by the end of the 2017/18 tax year. This would be a 10% annual rise and a jump of more than 50% since the £150,000 tax threshold was introduced seven years ago.

https://www.theguardian.com/politics...points-pledges

This squeeze on high earners is a key element in maintaining the pre-financial crash gap between rich and poor. But using the tax system in this way to help the poorest and tax the rich has a cost. It narrows the tax base to a relatively small group of people and means that when a government needs a revenue boost, as a Labour government will should it take office, it must return to the same people and demand not just a small percentage rise, but a hefty whack of extra cash.

The threat that professionals, from doctors and accountants to management consultants and bankers, will take their money offshore has some foundation to it. But, more importantly, working for a PAYE employer will be considered a mug’s game compared with running a small company and paying 19% corporation tax. Even under Labour, someone earning £80,000 could swap a 45% tax rate for a 26% corporation tax rate. (AtW's comment: oh FFS, how many times fooking cretins would ASSUME corp tax is all that's paid on money, add to it divi tax as high as 38.2%!)

Generating an income from wealth will also become more attractive. Property investment has always been a money-spinning proposition. Twenty years of the buy-to-let boom speaks to that. With higher income taxes weighing them down, many people already ask why they should work for a living when they can extract a generous rent as a landlord.

https://www.theguardian.com/politics...enerous-enough