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Topic Originator: The One Who Knocks
Date: Tue 19 Dec 18:53
New tax band to be introduced in Scotland for those unfortunates getting by on an annual wage between 75k and 125k. A progressive tax system, which I`m sure we are all in favour for, but it`s not going to bring in a huge amount and certainly won`t fill in the budget black hole that is looming. Something has got to give soon and it`s looking like it`ll be the government workforce that will bear brunt through redundancies though free university education is also now under threat.
And although my eyes were open
They just might as well be closed
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Topic Originator: jake89
Date: Tue 19 Dec 19:12
I`m in agreement on the approach but it won`t raise anywhere near enough tax to cover the shortfall. Fact is services will need to be cut back.
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Topic Originator: P
Date: Tue 19 Dec 19:18
Already before today from the last tax hike (source gov.Scot)….
“Only 11% of Scottish adults will pay the Higher Rate (42p), and 0.7% of the Scottish adults pay the Top Rate (47p). Despite this, these individuals are estimated to account for 65% of the total Income Tax take in 2023-24 which highlights the reliance of receipts from top earners.”
Why would you work full time or live in Scotland if you’re a decent earner?
As it is anyone with any sense will just whack more into their pensions and tax efficient schemes like sustainable cars or even simply reduce their hours as it’s not worth it if your at a tipping point where you are working to benefit the taxman.
Certainly not going to attract any higher earners to come here or anyone to set up business. Easy enough to work remotely as well and commute from north of England for your day or two in the office.
When you expect a small population to pay through the nose, that population will seek ways to legitimately pay even less than they otherwise would have done willingly.
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Topic Originator: wee eck
Date: Tue 19 Dec 19:24
I thought reports are saying all the changes to income tax will fill the `black hole` of £1.5bn due to the effect of 'fiscal drag' by freezing limits for other rates?
Post Edited (Tue 19 Dec 19:31)
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Topic Originator: P
Date: Tue 19 Dec 19:36
Quote:
wee eck, Tue 19 Dec 19:24
I thought reports are saying all the changes to income tax will fill the `black hole` of £1.5bn due to the effect of `fiscal drag` by freezing limits for other rates?
“Income tax has again ridden to the rescue for the Scottish Budget, generating an additional £700 million in funding for the 2024-25 budget than was expected this time last year. This isn’t really about the income tax rises announced in the Budget - which only raise £82 million, equivalent to less than 36 hours of Scottish NHS spending - but because of improved underlying revenue performance. ”
Over optimistic estimating will dent the black hole - reality probably will not
[URL] https://ifs.org.uk/articles/initial-ifs-response-scottish-budget[/URL]
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Topic Originator: Buspasspar
Date: Tue 19 Dec 19:55
Topic Originator: wee eck
Date: Tue 19 Dec 19:24
I thought reports are saying all the changes to income tax will fill the `black hole` of £1.5bn due to the effect of `fiscal drag` by freezing limits for other rates?
Not sure wee eck .. I read that the higher rate will generate 60 million to help offset the 1.5 billion over spend ..
Why would someone want to come work and live in Scotland P ? .. just ask the thousands upon thousands who are happy to come and live in this beautiful wee Country and get all the free benefits that they use to the max .. just saying
We are forever shaped by the Children we once were
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Topic Originator: wee eck
Date: Tue 19 Dec 20:22
I saw this in the Guardian, Bpp. I did find it surprising as I`m sure the unionist media were predicting the anticipated tax changes would only raise a paltry £60m.
`The Scottish Fiscal Commission, an independent oversight body similar to the Office for Budget Responsibility, said the tax changes would help push up the devolved government’s overall budget by £1.3bn, or 2.6% in cash terms, to £52.4bn overall.`
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Topic Originator: jake89
Date: Tue 19 Dec 22:08
I think some people fail to understand that someone on £75k doesn`t pay 45% tax. They pay 45% on what they earn above that. Every single person gets something like £12.5k tax free. I pay 42% but only on what I earn above 43k. Do I care? No because I don`t pay for prescriptions, didn`t pay for tuition fees, have had many years of free school meals for my kids and had free nursery hours when they were younger.
If someone earning £80k were to leave on the basis of paying an extra few quid a year then they need their head checked.
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Topic Originator: DBP
Date: Tue 19 Dec 23:01
Don’t try to talk sensible!!!
If you were on that sort of money, of course you would uproot your family to the north of England, pay for prescriptions, pay for your kids university tuition fees, suffer worse services generally, and cough up for a couple of tanks of petrol for your two days in the office commute each week in order to save those few pounds! 😂
Post Edited (Tue 19 Dec 23:02)
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Topic Originator: Wotsit
Date: Tue 19 Dec 23:14
The Tories would have raised a similar amount by raising NI or VAT - i.e. making poorer people pay disproportionately more.
I prefer the SNP`s way.
In fact, I`d be raising the top rate even more to pay for a significant raising of the tax free allowance. Someone earning £15k shouldn`t be paying income tax in my view - they already pay a significant chunk of that in fuel duty, Council Tax, NI and VAT for starters.
The enemy travels by private jet, not by dinghy.
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Topic Originator: P
Date: Wed 20 Dec 06:42
Quote:
jake89, Tue 19 Dec 22:08
I think some people fail to understand that someone on £75k doesn`t pay 45% tax. They pay 45% on what they earn above that. Every single person gets something like £12.5k tax free. I pay 42% but only on what I earn above 43k. Do I care? No because I don`t pay for prescriptions, didn`t pay for tuition fees, have had many years of free school meals for my kids and had free nursery hours when they were younger.
If someone earning £80k were to leave on the basis of paying an extra few quid a year then they need their head checked.
In the interest of balance you are forgetting to mention those people who will fall into the tax trap between £100,000 and £125,140 whereby the tax free allowance disappears - this now means they will be paying a real rate of 66% (60% in England).
A taxpayer on £125,000 will pay £5,221 more in Scotland in 2024-25 than their English equivalent in the same company - equivalent to about 7% of their after tax income.
However to preempt the standard reply “F them if they earn that they can afford it” etc etc ignoring any wider economic impact those people and roles have.
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Topic Originator: jake89
Date: Wed 20 Dec 08:08
True, they will pay more, but it`s all relative in terms of affordability. My big boss falls into that bracket. Is she going to do a midnight flit to England? No.
The question would be if it would discourage someone from outside Scotland moving here. I`d argue no.
The worldwide issue is how the rich are pandered to. Unfortunately, the rich control the countries so it`s convenient to keep those tax loopholes. And I mean the properly rich people rather than the CEO of Fife Council.
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Topic Originator: P
Date: Wed 20 Dec 08:28
Anybody coming here is going to use higher taxes as a bargaining chip for an even higher salary and rightly so - question is whether employers will want to pay that. That does potentially create opportunities for people already here which is no bad thing.
I know a lot of people in that bracket - they are suggesting they will just bang more into their pensions (up to £60k in AVC’s a year now - personally I would rather afford to put money into my pension than give it to the taxman). You can also use schemes for EV cars to reduce your top line too so while people can afford it I would expect many to take legitimate evasive manoeuvres to minimise the impact. For example I know a couple of people who once they went into the tax trap reduced their hours as they didn’t see the point (not sure how many industries or professions can support that though)
Course if there remains a gap in 2024, which can be expected, then the next budget will presumably target the £43k to £75k bracket for income tax which is reasonable.
I agree about the rich but I would see most people impacted as being middle class as opposed to properly rich.
Post Edited (Wed 20 Dec 08:49)
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Topic Originator: Tad Allagash
Date: Wed 20 Dec 09:37
You can’t talk about ‘free’ prescriptions and ‘free’ schools meals whilst the government helps itself to nearly half of people’s marginal income (not to mention employer’s NI AND employee’s NI).
The problem with income tax is that income is a very poor proxy for wealth. The wealthy are the people who bought property in Edinburgh in the 1970’s. The truly wealth don’t pay income tax.
The question is not whether people can afford to pay more. The question is whether the government can spend that extra money more effectively than they can. I think you’d struggle to argue that our government provide value for money.
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Topic Originator: The One Who Knocks
Date: Wed 20 Dec 10:26
C`mon now. When the average wage is something like 28k someone on three or four times that then I`m going to class them as wealthy even by UK standards. Of course it is all relative. I think if you are on more than 40k per year then you are among the top 1% of wealthiest people on the planet.
As for this proposed modest tax hike on the affluent, the problem I forsee is that haven`t we just gave the doctors a payrise to retain and attract them?
And although my eyes were open
They just might as well be closed
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Topic Originator: wee eck
Date: Wed 20 Dec 10:40
Re Tad Allagash`s post :-
I think everyone with any interest in politics knows that `free` means `free at the point of use` and that those services are financed through general taxation. In this weird set-up we have in the UK National insurance is controlled solely by Westminster whist both Westminster and Holyrood have some control over income tax.
I bought property in Edinburgh in the 70s because I became financially independent then and needed somewhere to stay. It wasn`t an investment decision. I still live in the same house and I`m retired now and pay income tax. Thanks for letting me know I`m wealthy. What exactly is your point?
I`m sure folk throughout the UK could argue with some justification that their governments don`t provide value for money given the effects of inflation and the aftermath of Covid.
Post Edited (Wed 20 Dec 10:43)
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Topic Originator: Parboiled
Date: Wed 20 Dec 10:54
Three tax bands in England Six up here. More friggin’ bands than Glastonbury…
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Topic Originator: The One Who Knocks
Date: Wed 20 Dec 11:01
I`ve long suspected you were a member of the bourgeoisie Wee Eck.
And although my eyes were open
They just might as well be closed
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Topic Originator: P
Date: Wed 20 Dec 11:12
Quote:
The One Who Knocks, Wed 20 Dec 10:26
I think if you are on more than 40k per year then you are among the top 1% of wealthiest people on the planet.
Doesn’t look like this targets the 1% though…
“According to the latest government data (September ‘23), the top 1% of earners make an annual income of £183,000 annually in the UK. This is significantly more than the average UK income of £33,280 in the UK.”
Forbes in June relating to the US
“to be in the top 1% of earners in the U.S., you need to bring in an annual salary of at least $597,815”
Fortunes 1% is below and I don’t think many in the new tax bracket will be in that threshold;
“Below is the shakedown of what it takes to be in the elusive 1% for the following 10 countries.
Monaco: $12.4 million
Switzerland: $6.6 million
Australia: $5.5 million
New Zealand: $5.2 million
United States: $5.1 million
Ireland: $4.3 million
Singapore: $3.5 million
France: $3.5 million
Hong Kong SAR: $3.4 million
United Kingdom: $3.3 million “
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Topic Originator: jake89
Date: Wed 20 Dec 17:13
Quote:
Parboiled, Wed 20 Dec 10:54
Three tax bands in England Six up here. More friggin’ bands than Glastonbury…
A more sliding scale approach is surely more logical though? Tax and benefits in the UK generally is messy. Far too black and white. For example, couple earning £49,999 each gets child benefit yet a single parent or family where someone earns £50,001 whilst the other is unemployed won`t get a penny. It`s a nonsense. A more sensible route would be a sliding scale based on household income.
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Topic Originator: LochgellyAlbert
Date: Thu 21 Dec 10:07
Shame that there hadn`t been the same outcry when the personal allowance was frozen for 5 years, that will soon entrap OAP`S should the triple lock continue.
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Topic Originator: The One Who Knocks
Date: Thu 21 Dec 10:42
I doubt the state pension will ever be higher than the state pension.
And although my eyes were open
They just might as well be closed
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Topic Originator: LochgellyAlbert
Date: Thu 21 Dec 13:11
Quote:
The One Who Knocks, Thu 21 Dec 10:42
I doubt the state pension will ever be higher than the state pension.
?????
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Topic Originator: The One Who Knocks
Date: Thu 21 Dec 16:16
Sorry LA. Meant to say doubt I the state pension will ever be higher than the personal allowance.
And although my eyes were open
They just might as well be closed
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Topic Originator: Dave_1885
Date: Thu 21 Dec 17:03
At least you get a pension 😂 my generation will soon need to work till 75 before seeing that, whilst paying a small amount into private funds - will never see mine
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Topic Originator: LochgellyAlbert
Date: Thu 21 Dec 17:08
Quote:
The One Who Knocks, Thu 21 Dec 16:16
Sorry LA. Meant to say doubt I the state pension will ever be higher than the personal allowance.
Some of the guys that just left the Yard will be paying tax on their SPA, they pick up more than £203.85 a week!
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Topic Originator: LochgellyAlbert
Date: Thu 21 Dec 17:17
SPA goes up 8.5% in April 2024, a further 2 × 5% rises will put you over the personal allowance!
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