What should the highest marginal tax rate be for any personal income

[badass]

Your marginal tax rate is different to your overall tax rate - see below.
https://en.wikipedia.org/wiki/Tax_rate#Marginal

I'm posting this poll to see where peoples attitudes on Tax and Income are.

If you think someone earning over say £1 billion in a year should be taxed at 100%, select no limit as the option. If you think they should pay 40%, then select around 40% and so on.

Currently, If you are childless, your marginal tax rates are:
0% for the first £8060 (0% NI, 0% Income tax)
12% for £8061-£11,000 assuming your pay is the same every week/month. NI is calculated weekly, Income tax is calculated yearly
32% for £11,000-£43,000 (12% NI, 20% income tax)
42% for £43,000-£100,000 (2% NI, 40% Income tax)
62% for £100,000-£122,000 (2% NI, 40% Income tax, 20% income tax as a result of allowance reduction)
42% for £122,000-£150,000 (2% NI, 40% Income tax)
47% for over £150,000

I am not including the fact that your employer has to pay 13.8% of every pound you earn in those examples and have left out tax credits, pension allowance reductions etc as it gets very complicated.

Is it fair and/or sensible that someone earning £100,000 pays 62p for every extra pound they earn, whilst someone earning £122,000 pays 42p?
Bare in mind that the reason the taper at £100k was introduced is "so that the rich do not benefit from the large increase in the personal allowance"
Also bare in mind that whether it makes sense or not, no government is going to get away with reducing the tax on 6 figure earners whilst cutting benefits. George Osborne found this out when he raised the 40% band whilst cutting benefits.

[peterb]

Wikipaedia is out of date. The personal tax allowance is now £11,000. Other tax bands have also changed.

https://www.gov.uk/income-tax-rates/...and-allowances

For national insurance rates and limits

https://www.gov.uk/government/public...-contributions

[CAT-THE-FIFTH]

Its not the tax which is the issue but what you get for it which is more important IMHO.

[Saracen]

Wikipaedia is out of date. The personal tax allowance is now £11,000. Other tax bands have also changed.

https://www.gov.uk/income-tax-rates/...and-allowances

For national insurance rates and limits

https://www.gov.uk/government/public...-contributions

The personal tax allowance is £11k for income tax, but most analyses treat NI as a form of income tax by another name. So someone with no other variations from default earning £11k wouldn't pay income tax, but as the Primary Threshold for NI, above which they start paying, is just above £8k, they would be paying NI on nearly £3k.
It works out at about £353, meaning the overall effective tax rate at £11k is 3.2%

The marginal rate, however, is 32% above (immediately above) £11k, because the marginal rate is the rate paid at the margin, which takes no account of personal allowances at all (unless the margin concrrned is an income rate within allowances, or beyond basic PA but above NI PT.

That is, at £11,001, it's the tax you pay on the final 11,001th pound. That would be 32%, otherwise known at 32p of that £1, consisting of 20% income tax and 12% NI.

Up to some £8060, the marginal rate is 0%.
From £8060 to £11000, the margibal rate is 12 %.
From £11,001 up to the next change, it's 32%.

All based on HMRC figures, 2016-17, as per HMRC

[Phage]

Cat has it spot on.
If we received substantially more from the govt for the tax then higher rates are fine. The Nordic model if you like.
OTOH if it's just more of the same. Then no.

There are a number of articles about how successive govts in this country have failed the social contract by not supporting the people. Hence the disillusion with the political elite because they simply don't deliver.

As soon as people do start delivering then people would be willing to pay for it.

[badass]

Its not the tax which is the issue but what you get for it which is more important IMHO.

This is about marginal tax rates though, not government wastage.
If the government was perfectly efficient - i.e. wasted not a single penny and you agreed 100% with the allocation of funds, you might still not agree with a marginal rate of 100% for people earning over £20,000 for example. i.e. Every penny you earn over £20,000 goes to the government and you see none of it.

Cat has it spot on.
If we received substantially more from the govt for the tax then higher rates are fine. The Nordic model if you like.
OTOH if it's just more of the same. Then no.

There are a number of articles about how successive govts in this country have failed the social contract by not supporting the people. Hence the disillusion with the political elite because they simply don't deliver.

As soon as people do start delivering then people would be willing to pay for it.

That's a completely different discussion.

[badass]

Personally, I clicked 50%. Anything more and you're not working for your employer. You're working for the government, regardless of how much you earn. I wouldn't object to paying a marginal rate of 50% myself if there were enough regulation in place to prevent pork barrelling, politicians interfering with things they do not understand simply to get votes/avoid losing votes*
Those two things are the root of the vast majority of avoidable government wastage.

As it currently stands, I object to paying any more than 40% marginal as the public as a group are thick and keep making it clear that they vote for politicians that:
Say they have simple solutions to complex problems. Even though more often than not those simple solutions have been tried before and failed.
Short termism is way to go. We'll promise you this now by mortgaging the future!
Most of the public don't care about those that are better off then them being penalised. They wilfully refuse to understand the Laffer curve https://en.wikipedia.org/wiki/Laffer_curve

Plus I believe that on every pay slip the amount of Tax your employer has to pay for your job should be clearly marked.

[Unique]

Personally, I clicked 50%. Anything more and you're not working for your employer. You're working for the government, regardless of how much you earn. I wouldn't object to paying a marginal rate of 50% myself if there were enough regulation in place to prevent pork barrelling, politicians interfering with things they do not understand simply to get votes/avoid losing votes*
Those two things are the root of the vast majority of avoidable government wastage.

As it currently stands, I object to paying any more than 40% marginal as the public as a group are thick and keep making it clear that they vote for politicians that:
Say they have simple solutions to complex problems. Even though more often than not those simple solutions have been tried before and failed.
Short termism is way to go. We'll promise you this now by mortgaging the future!
Most of the public don't care about those that are better off then them being penalised. They wilfully refuse to understand the Laffer curve https://en.wikipedia.org/wiki/Laffer_curve

Plus I believe that on every pay slip the amount of Tax your employer has to pay for your job should be clearly marked.

every pay slip in the UK is legally obligated to show the deductions / payments made, so the tax and NI deducted from employees and the employers NI must be shown, likewise any other deductions from pay such as student loads, pensions and court orders

but on the 50% thing, i agree that the total deductions from pay for tax and NI from an individual shouldn't be more than 50%, so once allowances are taken into consideration the employee still gets just over half their earnings, of course based on what we currently receive back at the moment and what we would likely get for the forseeable future. i can't imagine any significant changes to warrant deducting more in taxes than that

[Phage]

That's a completely different discussion.

I can see why you say that. But, you can't discuss how much tax you're willing to pay without any idea of services that everyone will receive. With services being cut - you can't expect people to pay more in tax surely ?

[Saracen]

This is about marginal tax rates though, not government wastage.

.....

That's a completely different discussion.

IMHO, yes and no.

I know what you're getting at, but I think Cat's point is .... let me put this another way so as to not put words in his mouth.

Personally, the rate I would set as the ideal marginal rate is determined by my view on the entire system which, in no small part, is highly influenced by my view of government wastage and the effeciency and effectiveness of said spending.

I, personally, would be much more willing to oay a higher rate IF I felt it was :-

a) spent on things I approve of, and
b) government processes were efficient in things like overheads, and
c) we got value for money as measured by effect per pound.

However, if I felt money was wasted on overpaid executives, grossly incompetent management and hugely exoensive white elephant projects, then I'll be beggared if I'd support increasing my marginal tax rate to support some idiot politician's personal ego trip.

Would I willingly pay more if it was dedicated to, for example, education (at the coal face), patient care in the NHS or menral health in the community? Yes.

Would I be willing to pay more for salary increases for NHS executives or council bosses already earning several hundred thousand, or for another supremely expensive but cocked up NHS computerisation project, or HS2? Hell will have to freeze over first.

You can't separate what marginal rate people would support at a given income level from either their perception of how well it'll be used, or in some cases from their ideological preconceptions, such as a hard socialist's view on tax rates on very high earners or the very wealthy.

I think, broadly speaking, that was Cat's point.

[badass]

every pay slip in the UK is legally obligated to show the deductions / payments made, so the tax and NI deducted from employees and the employers NI must be shown, likewise any other deductions from pay such as student loads, pensions and court orders

I don't think I was clear in the quoted text. Every pay slip shows how much employees NI is paid. What it doesn't show is how much employers NI has been paid by your employer in order to employ you. Last time I checked, on top of the figures I mentioned earlier, employers NI was 13.8% of the entire salary although there were some discounts available for hiring new staff.
You may or not be aware of this. The vast majority of the population are unaware of the employers NI obligations.

[badass]

I'm interested in hearing from those that voted for 10% and 80% and why they chose those figures.

[Gerrard]

I don't think I was clear in the quoted text. Every pay slip shows how much employees NI is paid. What it doesn't show is how much employers NI has been paid by your employer in order to employ you. Last time I checked, on top of the figures I mentioned earlier, employers NI was 13.8% of the entire salary although there were some discounts available for hiring new staff.
You may or not be aware of this. The vast majority of the population are unaware of the employers NI obligations.

My payslips show Employers NI. Unless there is another overhead you are referring to?

I said 50% for the aforementioned reason that any more and you are working for the government; from a psychological POV anyway. But I can see the above views that if the state were efficient that people would be more understanding on paying more.

[Unique]

I don't think I was clear in the quoted text. Every pay slip shows how much employees NI is paid. What it doesn't show is how much employers NI has been paid by your employer in order to employ you. Last time I checked, on top of the figures I mentioned earlier, employers NI was 13.8% of the entire salary although there were some discounts available for hiring new staff.
You may or not be aware of this. The vast majority of the population are unaware of the employers NI obligations.

i said in my post "NI deducted from employees and the employers NI must be shown,"

whether people know the rules or not is irrelevant, employers have to follow those rules and post all the information on the payslip you said should be on it. it already has to be on it

employers NI isn't 13.8% of the entire salary. it's 13.8% of earnings over the threshold for certain staff. no employers NI for 16-21 year olds. no discounts for hiring new staff. all the details are on the HMRC website if you google "HMRC national insurance 2016"

[peterb]

It's is slightly more complicated if you have two or more jobs. Income tax is applicable on total earnings in any one year, while National insurance is payable per employment, so you are financially better of with two jobs earning just below the Primary threshold (so you pay no NI than you would doing one job that paid the same as the two separate one.

Payslips do not have to show employers NI contributions. Employers NI contributions are an allowable expense against Corporation tax, as are employees gross payments.

[badass]

i said in my post "NI deducted from employees and the employers NI must be shown,"

whether people know the rules or not is irrelevant, employers have to follow those rules and post all the information on the payslip you said should be on it. it already has to be on it

employers NI isn't 13.8% of the entire salary. it's 13.8% of earnings over the threshold for certain staff. no employers NI for 16-21 year olds. no discounts for hiring new staff. all the details are on the HMRC website if you google "HMRC national insurance 2016"

After seeing this post I checked my payslip and sure enough the employers NI and pension contributions are on it.