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[Nilocy]

Alistair Darling revealed his Pre-Budger Report today. In a 50 minute speech he basically outlined what our taxes and that are going to be for the next year at least. Some of these measures are quite good; he's reducing taxes for electric car users, increasing school meals for kiddies. And, this is probably my favourite thing, taxing banks on their bonuses they give at 50%. (yeah, 50% woo!)

Some of the not so great things for most families in the UK is that he's increasing the National insurance an extra 0.5p (half a pence) per £1 for people earning over £20,000 a year, basically they'll be taxing an extra £90 or so from those people. But overall this'll generate £3Billion for the NHS, police forces and schools. Its even more for people earning over £40,000. So basically the rich are getting taxed more than the poor. (people earning under £10000 a year will actually save money).

But what annoys me is when people are excessively greedy and get in a ruffle over their money being taxed. I'm in total agreement with what he's planning here.  But when this money is going to fund public health, safety and education services. Should they be willing to part with £90 a year?

So my question is this: Is it right to increase taxes for those earning more to support those less wealthy? And would you hand money over to the government if it was going to be spent on improving public services?

I kinda interested in what other countries think of this method; particulary Americans since they'll be having issues like this soon I hope.

And rules: No trolling or insulting people or their countries please.

[Blacken]

To an extent, certainly you must tax people who make more money more in order to generate governmental revenue. It's simple mathematics--the poor don't have the money to tax, and some services are necessary for a country to actually function at all.

The question becomes, where is the appropriate balance? Many factors affect the proper amounts to levy. Increased taxes generally decrease employment and overall productivity--the multiplier effect, when applied to the lesser cash flows after taxes, means that less money is being turned into goods and services. Yes, you can make the argument that the government is increasing employment and sort-of increasing overall productivity based on that tax revenue, but let's be serious now, the government has never and will never be a competitive employer. The more people the government employs, the harder it is for market companies to employ people, for a host of reasons. The government has no real drive to innovate, no drive to perform optimally and run the leanest, most effective machine it can--only to self-perpetuate. Giving them more money to do so strikes me as foolishness.

There are also ethical and moral questions raised by taxing the middle-class. (The "rich"--that is, having the proverbial fuck-you money--starts in the multiple millions; they are being taxed higher, but they are certainly not the only ones.) I see significant moral hazard in taxing the haves in order to provide shinies for the have-nots--not because of greed, but because the people giving the have-nots said shinies are doing it in order to get re-elected rather than because they actually care. Benefits to the people are a side effect at best.

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[Blacken]

it stands to reason that the high earners must have earned their position

"Some people are born on third base and go through life thinking they hit a triple."

At some point you have to tax the higher earners more in order to actually function. The question is where, and how. For example, I'm a lot more okay with high estate taxes than I am high income taxes. I don't like dynastic wealth.

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[Nilocy]

I'm in favour of taxing higher earners due to the simple fact that you don't need a proportionally higher amount of money to live a proportionally higher lifestyle. Bread still costs the same for poorer and richer people.

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[Blacken]

I'm in favour of taxing higher earners due to the simple fact that you don't need a proportionally higher amount of money to live a proportionally higher lifestyle. Bread still costs the same for poorer and richer people.

You need a proportionally higher amount of money to employ people. That's what the rich do that the poor don't.

As I touched on briefly above, the government is a piss-poor employer.

[Nilocy]

No, I don't think your seeing what I said there. Basically thats the individual tax, not corporate.

[Blacken]

No, I don't think your seeing what I said there. Basically thats the individual tax, not corporate.

And a sole proprietorship, grossing two hundred large a year? In the States at least, what isn't paid to employees is taxed as the owner's personal income.

Do you want to encourage him not to hire more workers by taking a larger chunk of his money? Perhaps just substituting his own labor in place of an employee's--working harder to keep the same take-home pay, while not employing someone else? I would hope not. There is a delicate balance to be struck, and erring on the side of "oh, they're rich, they can afford it" sounds rather like class envy. And as someone who very much aspires to be only marginally poorer than Bill Gates someday, that upsets me.

(That's another interesting point--higher taxes tend to drive down charitable donations. Interesting, no?)

[Il Palazzo]

I'm all against progressive taxation. Even with the same tax rate for everybody, the rich are paying more than the poor(as in:20% of 30000$ is more than 20% of 10000$). Taking more money from somebody who, due to his own hard work, became more wealthy than your average person, is not exactly promoting resourcefulness in people.
Hell, in an ideal world, I'd like to see a tax system where everybody is required to pay a fixed amount of cash every year, and whatever he earns above that is nobody's business but his.

[Blacken]

I'm all against progressive taxation. Even with the same tax rate for everybody, the rich are paying more than the poor(as in:20% of 30000$ is more than 20% of 10000$). Taking more money from somebody who, due to his own hard work, became more wealthy than your average person, is not exactly promoting resourcefulness in people.
Hell, in an ideal world, I'd like to see a tax system where everybody is required to pay a fixed amount of cash every year, and whatever he earns above that is nobody's business but his.

That ends up being nonsensical. If you do that, the logical outcome is to not work and take advantage of welfare services. Your system is trivially gamed.

Unless you think that debtor prisons are a good idea.

[kuro_suna]

The main problem I have with trickle down is that with very few exceptions you aren't going to get particularly wealthy through your own efforts alone, much more likely its going to be in part from the efforts of people you employ or at least rely on services of others. In that long chain from upper managers to farmers odds are someone at least went to public school so unless your living on a Amish commune you can't say government services haven't done anything for you.

[Il Palazzo]

I'm all against progressive taxation. Even with the same tax rate for everybody, the rich are paying more than the poor(as in:20% of 30000$ is more than 20% of 10000$). Taking more money from somebody who, due to his own hard work, became more wealthy than your average person, is not exactly promoting resourcefulness in people.
Hell, in an ideal world, I'd like to see a tax system where everybody is required to pay a fixed amount of cash every year, and whatever he earns above that is nobody's business but his.

That ends up being nonsensical. If you do that, the logical outcome is to not work and take advantage of welfare services. Your system is trivially gamed.

Unless you think that debtor prisons are a good idea.

You just need to reduce welfare system to necessary minimum. E.g. lack of job wouldn't qualify you to get free monies from the government.
Then the logical outcome is to quit whining and get a job.

[kuro_suna]

I'm all against progressive taxation. Even with the same tax rate for everybody, the rich are paying more than the poor(as in:20% of 30000$ is more than 20% of 10000$). Taking more money from somebody who, due to his own hard work, became more wealthy than your average person, is not exactly promoting resourcefulness in people.
Hell, in an ideal world, I'd like to see a tax system where everybody is required to pay a fixed amount of cash every year, and whatever he earns above that is nobody's business but his.

That ends up being nonsensical. If you do that, the logical outcome is to not work and take advantage of welfare services. Your system is trivially gamed.

Unless you think that debtor prisons are a good idea.

You just need to reduce welfare system to necessary minimum. E.g. lack of job wouldn't qualify you to get free monies from the government.
Then the logical outcome is to quit whining and get a job.

Nobody would get a job because 80% of the population would make zero dollars after tax unless you cut government expenses like police and military.