4 thoughts on “Tax simplification”

  1. Posted 03/04/2012 at 10:59 | Permalink

    If only this affected tax professionals…If you have children the tax system is grim. Up to about £30K you will receive means-tested benefits that are withdrawn on the basis of household income. So, you need, effectively, three tax returns – one for the household and one for both the parents. Then you are okay for a bit but, at £50K, you get child benefit withdrawn – this time it is based not on personal income or household income but on the income of the highest earning person in the household. And this will have to be assessed on a self assessment tax forms (which previously such people did not generally have to fill in). It will be withdrawn at different rates depending on how many children you have. After £60K, you can relax for a bit until you reach £100k and have your personal allowance withdrawn – though at least this is based on your personal income. The government that does not feel comfortable with the 50% tax rate apparently does feel comfortable with the 60% tax rate that this leads to. So, for pretty prosperous people here, we have eight or nine different marginal tax rates above (say) £22k a year and – amazingly – four different methods of assessment (two adults being assessed as separate people, the household and the highest income earner in the household). The government thinks you should be taxed at 40% if you earn £40K, £61K or £120K but not at £50K or £100K. And this is before the generation of people who are paying back what is, in effect, a graduate tax start their repayments.

  2. Posted 03/04/2012 at 11:54 | Permalink

    I must’ve missed the lower taxation part of this plan, I’m paying more direct and indirect tax than I did when the coalition were elected and will be paying yet more in the next tax year with no end in sight to the tax rises for me, while businesses continue to see their tax bills drop and continue to return record sums to shareholders and themselves in ever-increasing executive compensation.

    Between tax cuts, direct and indirect corporate welfare (in-work benefits meaning wages have no need to attempt to keep pace with the costs of living) we’ve become more competitive for businesses for sure, shame it’s bleeding many would-be consumers of their products of what little disposable income they have to actually buy the end products.

  3. Posted 03/04/2012 at 14:22 | Permalink

    And then they have the gall to demonise people who attempt to minimise the impact of all this. I would be surprised if one in a hundred knows what they really ‘should’ be paying.

  4. Posted 14/04/2012 at 10:24 | Permalink

    Consumers are unwittingly the ultimate “Taxpayers”.

    Consumers’ cash necessarily supports the entire hierarchy of commerce. There is not a commercial entity that can survive without ultimately servicing the needs of consumers, directly or indirectly. From whom else do you suppose businesses and employees make money? Every tax incurred in the supply chain shows up as a hidden tax in consumer prices.

    Consumers should now realise that no one else could reasonably claim to be paying any of those self same taxes.

    ‘Income Taxpayers’ are simply involuntary intermediaries in the collection of tax from consumers. ‘Income Taxpayers’ are not always reliable as third party tax collectors, as we know, but their use provides great scope for confusing the issue of who really pays tax and concealing the full crushing cost of Government from voters.

    The notion that, in the transfer of customers’ money to HMRC, businesses and employees “pay” or really bear any of the burden of income taxes is the greatest illusion of our age. Income taxes are obviously the preferred backdoor method of taxing consumers, while pretending to be the epitome of fairness.

    As a result we consumers pay an average of 50p tax in the pound when we spend. It would be a tremendous simplification to explicitly tax retail purchases alone, but admitting the headline rate might be too uncomfortable.

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