Damn Lefties

[schmunk]

I wouldn't mind so much if the money went to the right part of the welfare state, education, sports + parks etc.

I've not switched to one of those questionable tax things, but who honestly isn't tempted by an extra £35k a year?

I wrote a big post about Offshore Employment Benefit Trusts (which is the vehicle being considered here), but it failed to post correctly and I lost it.

In short:

• They appear to be legal now but at a whim HMRC may declare them unacceptable avoidance, and could even backdate this.
• The taxable benefit on the loan is cumulative (i.e. you still pay tax in year 2 on the 'loan' you took in year 1, as well as the additional amount taken in year 2, so it's a diminishing relief.
• You become a creditor of the offshore employer and, if it fails, you will be chased to repay the 'loans' , possibly in full, leaving you with no income and a large debt.
• The loan is by definition 'repayable', so the employer could at a whim recall the loan, again leaving you to survive on minimum wage (the employer has to at least pay you minimum wage).
• If ever the loan becomes non-repayable (i.e. you keep the money without risk of forfeiture), you will be taxed on it in full. This is in addition to the taxes you have been paying on the 'loan' benefit. If this doesn't happen during your lifetime, it'll happen at death - a nice surprise for your children...

[Fraz]

I'd be very interested in seeing more on this, as I suspect that either you have the wrong end of the stick, or they are lying, or that this is tax evasion and the aforementioned dentists are going to get a nasty shock at some point (you can't insure against prison).

There really aren't many ways for a UK resident and domiciled individual to avoid tax (I am presuming these dentists are UK resident and domiciled...), and really the only ways I can think that these dentists might be making such significant tax savings would be huge capital expenditure (and therefore capital allowances), or otherwise making large pension contributions, neither of which is a revolutionary concept, or something I'd pay £10,000 for.

Yeah, I am going to find out more about this - I am seeing a friend of these idiots tomorrow. Regardless of whether or not it is actually legal or possible to get away with this kind of thing, the point is that these rubbishrubbishrubbishrubbishrubbish wanted to avoid paying all their taxes when they already had really good incomes.

Anyway, I shall post again when I have more info about this.

[TheAnimus]

Disregarding the issue of market forces for a while, do you honestly think that a man who earns £95k (or £125k depending on tax loopholes) actually works 4-5 times harder/longer than the man who only earns £25k?

You assume worth has a linear correlation to effort? I make no such assumption.

Going back to the idea of market forces, as that is what dictates wage, remember if i earn as much as say a teacher, I would go back to doing just that, I found it very enjoyable. As such a company has to pay me to reduce the enjoyment of my life a bit.

If we tax people like me more, the company will have to pay more, until they get to the point and say hey, lets go to Geneva (one of my previous employers has done just that, this isn't me been hypothetical). Now whilst I've only spent 3 days in Geneva, I quite liked it, good food, nice people, the only downside is of course the French. But given the extra money that I would get because of the lesser tax, the extra money the company would have because of the lesser tax........ Tempting.

This brings us to the idea that taxing business is a tricky one. Business create jobs, and more money (which could be taxed, if taxation was the only goal of the government) it is a hard optimisation task to do.

However, we are already seeing an exodus of people, I know that the nameless company I mention above will mean a loss of about $0.5bn a year for HMRC, because they turned the screws too much, it was entirely because of the 50p rate.

They're both just trying to support themselves and their families so why shouldn't the one earning way beyond his needs be taxed higher to provide services that they both need (and let's face it, most tax goes to things like the NHS, schools, roads and Bobbys on the beat and not to illegal wars and stupid ID schemes despitte what the tabloids would have us believe)?

Because its someone else saying its beyond his needs.

Riddle me this, a friend I made on my holiday, was very proud over the money she earn't, it was about £46 a month. She was quite bright by my standards (IQ in <0.5% of population group), had no access to free schooling, but had self taught English to an excellent standard in 1.5 years.

So why don't we all give 90% of our income, to these people?

How many Hawkings of this world are un-discovered because of this? That Indian kid who figured out calculus by himself for instance.

Because, we don't give a ****. And this is the crunch, I don't give a **** about you either, or anyone else on low income. I'm selfish, i want my money and to allocate it how I see fit, is that a crime?

[Phage]

I should point out that we already have a progressive tax system that re-distributes wealth to the poorer sections of society. The problem appears to be the implementation. However, that is no excuse for neo-Marxism. We've seen that fail more than once.

[Fraz]

I wouldn't mind so much if the money went to the right part of the welfare state, education, sports + parks etc.

Nail on head.

But then, why would the government go for a long-term solution such as raising the education standard of the nation, when it can just come up with some more totally ineffective, voter-friendly quick-fixes in an effort to get it self re-elected (so it can screw things up some more)? *sigh*

[Salazaar]

I'm selfish, i want my money

And we get to the real crux of the matter, there's no arguing with that.

[Fraz]

Now whilst I've only spent 3 days in Geneva, I quite liked it, good food, nice people, the only downside is of course the French.

Not to mention all the bankers...

[Fraz]

Because, we don't give a ****.

I really don't think you are qualified to speak on behalf of the rest of us.

[Phage]

And we get to the real crux of the matter, there's no arguing with that.

I disagree. I have a Libertarian viewpoint on this. I studied for 10 years at night school to reach a nice middle-class income. (nowhere near your Dentists) I fail to see why I should be taxed more heavily to support those who will not put in the same level of effort.

NB I'm privately insured and don't use the NHS, and I don't use the schools. The Police haven't been "Bobbys on the Beat" for 50 years and the roads are rubbish. Largely funded by the council BTW as are the schools. What exactly am I paying for ? MPs ? MEPs ? Actually we should increase the military budget as that is the only thing that has a tangible benefit. Ex-service people are treated shamefully. Moreso after discharge.

What I can see is a derailment of any possible discussion by reverse snobbery.

[Salazaar]

I disagree. I have a Libertarian viewpoint on this. I studied for 10 years at night school to reach a nice middle-class income. (nowhere near your Dentists) I fail to see why I should be taxed more heavily to support those who will not put in the same level of effort.

I'm not saying you should be taxed more heavily, I don't know what your middle class income is but I imagine it's quite comfortable. However were you on a fat cat wage I'd be asking that you stop being a whinging cock and pay some fair taxes, not because you have to but because it's better for the country as a whole.

NB I'm privately insured and don't use the NHS, and I don't use the schools.

Your choice, should we go back to private schools for only those who can afford them and a wonderful health care system such as the one in the US then?

The Police haven't been "Bobbys on the Beat" for 50 years and the roads are rubbish. Largely funded by the council BTW as are the schools. What exactly am I paying for ? MPs ? MEPs ? Actually we should increase the military budget as that is the only thing that has a tangible benefit. Ex-service people are treated shamefully. Moreso after discharge.

I can see police on the beat from my office window. Council funding is made up of both local and central taxes, it's stupid to try and imply that it's exculsively the province of council tax (which is still wealth dependant anyway).

And yes, we should treat our service men and women better. Perhaps by not sending them to fight, potentially illegal and unwinnable wars in the first place?

[TheAnimus]

Because, we don't give a ****. And this is the crunch, I don't give a **** about you either, or anyone else on low income. I'm selfish, i want my money and to allocate it how I see fit, is that a crime?

I really don't think you are qualified to speak on behalf of the rest of us.

The I'm is based on my emotions and desire if you will.

the 'we' is based on cold observation. Why aren't people earning £12,000 a year giving away half of it to help school kids in developing countries?

[Salazaar]

Why aren't people earning £12,000 a year giving away half of it to help school kids in developing countries?

Who said anything about people on £12,000 a year? That's a tough wage to live on in this country. However someone on £120,000 a year could give away £60,000 and still live very comfortably indeed.

They won't of course, for reasons you made quite obvious.

[Phage]

stop being a whinging cock and pay some fair taxes, not because you have to but because it's better for the country as a whole.

Personally abusive. Typical response. Have you considered debating the point at all ?

Your choice, should we go back to private schools for only those who can afford them.

We already have this system. We had a better system with higher social mobility before Labour got their hands on it. If you want to see a succesful Govt education system, go and see the Australian model which succesfully combines three or four types of school without the class war you insist on engendering.

and a wonderful health care system such as the one in the US then?

Strawman. There are other models such as (again) the Australian system which combines elements of both public and private care.

I can see police on the beat from my office window.

So ? I can't. Anecdote isn't evidence. Have you dealt with the cops since 1953 ? Charming bobbies were they ?

it's stupid to try and imply that it's exculsively the province of council tax (which is still wealth dependant anyway).

Read it again. The word is largely. And I agree Council tax is also a progressive tax. I probably pay more than you do.

And yes, we should treat our service men and women better. Perhaps by not sending them to fight, potentially illegal and unwinnable wars in the first place?

Definitely agree on this one. (Yay !) Makes me very angry, and even angrier at their treatment when they come home.

[Phage]

Who said anything about people on £12,000 a year? That's a tough wage to live on in this country. However someone on £120,000 a year could give away £60,000 and still live very comfortably indeed.

They won't of course, for reasons you made quite obvious.

Actually he makes a serious point. If a high earner pays 50% tax, why shouldn't a low earner ? They both work as hard.
The answer is that we have a progressive tax system because we generally feel that high earners should contribute more to society than low earners. However, punitive rates, neo Marxism and reverse snobbery will, over time, be bad for the country as well.

[Salazaar]

Personally abusive. Typical response. Have you considered debating the point at all ?

Typical how? I don't remember being abusive before. Anyway, that's completely disregarding my point that it's not the hard working middle income that I have a problem with, or that was even the point of this topic, it's the high earning tax dodgers.

We already have this system. We had a better system with higher social mobility before Labour got their hands on it. If you want to see a succesful Govt education system, go and see the Australian model which succesfully combines three or four types of school without the class war you insist on engendering.

We'd have a better system if class sizes were reduced and teachers could do more focussed teaching. Whatever way you want to spin it, it require state money to pay for a decent education system than is open to all.

Strawman. There are other models such as (again) the Australian system which combines elements of both public and private care.

And again, there is still a substantial requirement for state money to make such a system work.

So ? I can't. Anecdote isn't evidence. Have you dealt with the cops since 1953 ? Charming bobbies were they ?

Anecdotes? Pot. Kettle. Black. My uncle, my cousin and one of my best friends from Uni are all (or have been) coppers, it's a hard job and I'm sorry that the police you may have encountered may not have been up to scratch but those that I've met (three this week as part of my job) are just normal men and women doing a tough job as best they can. Do you actually think it's right to bad mouth the police in the same post that you complain that the armed services are underfunded? They're both suffering from similar basic problems.

Read it again. The word is largely. And I agree Council tax is also a progressive tax. I probably pay more than you do.

Certainly. I can't afford to get on the housing market at the moment, so I'm left living at my parents. But it doesn't change the point that council tax is a very minor contributor to the overall budget.

Definitely agree on this one. (Yay !) Makes me very angry, and even angrier at their treatment when they come home.

Good, they deserve so much better!

Actually he makes a serious point. If a high earner pays 50% tax, why shouldn't a low earner ? They both work as hard.
The answer is that we have a progressive tax system because we generally feel that high earners should contribute more to society than low earners. However, punitive rates, neo Marxism and reverse snobbery will, over time, be bad for the country as well.

Because you've got to balance idealism with reality, obviously. If you tax someone 50% of a pittance they'll end up in poverty, if you tax someone 50% of a fortune they've still got half a fortune. Maybe the high earner do contribute more to society, but is that a good enough moral reason for them to stockpile their wealth when it could be used for the benefit of society as a whole. No one's asking to bankrupt them, just for them to stop squirreling away every penny they can just for the sake of amassing wealth.

[TheAnimus]

Who said anything about people on £12,000 a year? That's a tough wage to live on in this country. However someone on £120,000 a year could give away £60,000 and still live very comfortably indeed.

They won't of course, for reasons you made quite obvious.

I love the way, you are completely blind to this hypocrisy, £12,000 is MORE than enough to live on. Easy really damn easy.

Now you don't need TV, might not need electricity (if you have say mains gas, or a wood burning stove) 90% of people definitely don't need a car, I know I certainly don't.......

In fact I picked £6k because when I was a student, that was the most I spent in a year, and I was hardly starving, or sober most of the time.

But yes your right, its only people who can afford a bently who should make a sacrifice, not people who can just about manage to afford a TV or an iPhone, those are clearly not conspicuous consumption, unlike those rich theaves in the city, with their spendings.

When you really are introspective, and grown up enough to not have this 'someone else' attitude then I might have an ounce of respect, as it stands i'm going to assume I probably pay considerably more tax than you, donate a lot more money (not to mention my rather expensive and prised by me at least, time) to charity. Your perfectly morally right to say I should pay more aren't you?

If you had a flat rate tax of 30% say, someone on 100k would pay 30k, someone on 10k would pay 3k. Nice and simple, fairly fair. the fact its already painful, and the talk of 50% on bonuses of over £25k (my last job half my salary was discretionary, one way to make people work a lot harder!) Not really fair at all is it?