SNP 52% Taxation Rate

SNP 52% Taxation Rate

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Discussion

Leo-RS

Original Poster:

288 posts

163 months

Thursday 24th March 2016
quotequote all
As you all probably know, the SNP have stated that they are not aligning the 40% band in Scotland with the 40% band in the rest of the UK. Scotland will increase the rate by CPI only whereas in England, George Osborne is pressing ahead with his plans to raise the band to £50k by 2020.

As of next year, Scotland's band will start at £43,387 and England's band will start at £45,000 which means anyone earning £45k+ in Scotland will be £323 worse off growing each year as the gap widens.

There is a discrepancy however in the NI bands where Osborne quite rightfully aligns NI with the income tax band so that when 40% becomes payable, National Insurance drops from 12% down to 2%

Can anyone else see where this is leading?

Scotland have no say over National Insurance contributions which means that in Scotland we will have to pay 12% NI contributions upto £45k, not £43,387. This in effect gives a marginal taxation rate of 52% (40+12) for the difference in 40% bands.

This will affect any Scot earning in the £43-£50k region, those that contribute to a pension and those that don't. It will also affect people on salaries lower than £43k where with a little bit of overtime, a bonus, or a promotion pushes them above £43k and they are hit with a 52% tax rate in its entirety.

As the differences grow then more and more people will be caught up in this 52% band. Predictions going forward put rest of UK at £51k in 20/21 and Scotland at £46k with CPI inflation. Lots of Scots will therefore be caught up in this anomaly where their higher rate tax will be 52% whilst the same people in England earning the same salaries will be paying tax at 32% (20+12%)

This really is scandalous but the SNP have the May elections in the bag for a 3rd term and there's nothing anyone can do about it. I'm sure sh*t will hit the fan later down the line.

Edited by Leo-RS on Thursday 24th March 07:26

grumbledoak

31,765 posts

239 months

Thursday 24th March 2016
quotequote all
Does the extra revenue go south, or is it all this extra Scottish tax to be kept and spent in Scotland? If it is the latter, surely the Scots have got exactly what they voted for?

Leo-RS

Original Poster:

288 posts

163 months

Thursday 24th March 2016
quotequote all
Scotland voted to remain part of the UK, although if you are on about the Holyrood elections in May, yes, unfortunately so many have been brainwashed with the Independence ideology that Scotland has turned into a 1 party state. The SNP it seems can do whatever the hell they like as they will always have a vast following of 'Yes' voters that will vote for them regardless of their local policies.

I believe 16/17, the Scottish government levy a 10p in the pound charge on the income tax received by Westminster. From next year, I believe the whole lot goes to the Scottish government. National insurance is different though, this will always go directly to Westminster, Scotland have no control over NI.

grumbledoak

31,765 posts

239 months

Thursday 24th March 2016
quotequote all
Yes, I was referring to Holyrood's tax raising power/s. It seems to me that the Scots are more socialist than the English, or at least have been in the past. It all looks very different when you are the magic money tree, of course.

It's all an awful mess though, the political representation and tax/revenue distributions unfair in every way.

jith

2,752 posts

221 months

Thursday 24th March 2016
quotequote all
Leo-RS said:
As of next year, Scotland's band will start at £43,387 and England's band will start at £45,000 which means anyone earning £45k+ in Scotland will be £323 worse off growing each year as the gap widens.


Edited by Leo-RS on Thursday 24th March 07:26
I can stay quiet no longer.

You poor soul. It is absolutely disgraceful that you will only be left with over forty three thousand pounds to live on. How the hell are you and your poor starving urchins going to manage on that? I mean it's only around eight hundred and forty quid a week!

You should try running a small business in this god forsaken, WESTMINSTER and Europe contaminated environment. I haven't had a wage for over a month.

Independence ideology?? Please don't insult my intelligence. If you don't like what is happening up here move to England where you will pay twice as much for property, spend half your life sitting in stationary traffic and share your country with millions of immigrants. How far do you think your extra three hundred and twenty three pounds will go there?

This country was well and truly screwed before the SNP took over, and that was the result of 300 years of Westminster rule. Ideology has nothing whatever to do with the simple act of disconnecting this country from the toxic management of Westminster. It can only benefit from that.

J

Leo-RS

Original Poster:

288 posts

163 months

Thursday 24th March 2016
quotequote all
I will ignore most of that as your rhetoric is completely irrelevant to the point raised. You have also misinterpreted my post, the £43k you talk of is before tax, the government take a great chunk of that away in Tax/NI. For the record, I never once mentioned my income.

The question is, why should we be taxed higher in Scotland than those that are in England? It penalises aspiration. You're just as well putting a sign up at the border saying "Welcome to Scotland, the highest taxed region of the UK"

If a top foreign brain surgeon or cancer specialist has the option of working in Manchester or Glasgow, he will look at the financial impact, the taxation levels and no doubt choose Manchester. The same applies for the top Engineers, Scientists, Businessmen etc, we are in effect killing off aspiration and success.

Why did Sturgeon back away from upping the top tax band from 45% to 50% income tax? She said it herself, she is scared of losing these taxpayers to England as the subsequent loss of tax revenue would create a huge black hole in Scotland's budget.

Someone earning £100k will pay £29,000 in income tax alone never mind national insurance. Someone earning a fairly average median wage of £20k (applies to a lot of Scotland) pays just £1800 in income tax. Do the maths, lose 1 x £100k earner and you need 16 x £20k workers to replace what he was paying in income tax. Someone earning £200k will pay a whopping £76k in income tax. Lose him and you would need 42 x £20k workers to replace him with.

Scotland cannot afford to lose those that contribute the most. The message should be loud and clear, if the differences between Scotland and England open up so they are substantial, then people will be switching homes on paper to avoid paying Scottish income tax. Look at the North Sea industry, lots come to Aberdeen/North Sea to work and then get the train home to England after a rotation/shift. If you have a family member or friend living south of the border line, all you need to do is register on their electoral role, tell your employer your 'new address' and you bypass Scottish tax altogether. This is what will happen if you push and squeeze higher earners too much and hence why Sturgeon never went down that path with the 45% band.

You say move down south, see if its any better, but look at the maths above, 1 x £200k earner is the equivalent of 42 x £20k earners. Now multiply those figures for the numbers that may leave. The top 10% of Scotland's earners pay over 50% of the income tax receipts.

I'll leave you with this....

Suppose that, every day, ten men go out for beer and the bill for all ten comes to £100.
If they paid their bill the way we pay our taxes, it would go something like this...


The first four men (the poorest) would pay nothing
The fifth would pay £1
The sixth would pay £3
The seventh would pay £7
The eighth would pay £12
The ninth would pay £18
The tenth man (the richest) would pay £59
So, that's what they decided to do.
The ten men drank in the bar every day and seemed quite happy with the arrangement; until one day the owner threw them a problem.
"Since you are all such good customers," he said, "I'm going to reduce the cost of your daily beer by £20." Drinks for the ten now cost just £80.
The group still wanted to pay their bill the way we pay our taxes.
So the first four men were unaffected. They would still drink for free.
But what about the other six men? The paying customers? How could they divide the £20 windfall so that everyone would get his fair share?
They realised that £20 divided by six is £3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer.
So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay.


And so the fifth man, like the first four, now paid nothing (100% savings)
The sixth now paid £2 instead of £3 (33% savings)
The seventh now pay £5 instead of £7 (28% savings)
The eighth now paid £9 instead of £12 (25% savings)
The ninth now paid £14 instead of £18 (22% savings)
The tenth now paid £49 instead of £59 (16% savings)
Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings.
"I only got a pound out of the £20," declared the sixth man. He pointed to the tenth man, "But he got £10!"
"Yeah, that's right," exclaimed the fifth man. "I only saved £1 as well.
It's unfair that he got ten times more than I!" "That's true!!" shouted the seventh man. "Why should he get £10 back when I got only £2? The wealthy get all the breaks!"
"Wait a minute," yelled the first four men in unison. "We didn't get anything at all. The system exploits the poor!"
The nine men surrounded the tenth and beat him up.
The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they
discovered something important. They didn't have enough money between all of them for even half of the bill!
And that is how our tax system works.

The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just
may not show up any more. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.
For those who understand, no explanation is needed.
For those who do not understand, no explanation is possible
Now who's round is it ?????

Edited by Leo-RS on Thursday 24th March 12:31

ALBA MELV

389 posts

162 months

Thursday 24th March 2016
quotequote all
Leo-RS said:
I will ignore most of that as your rhetoric is completely irrelevant to the point raised. You have also misinterpreted my post, the £43k you talk of is before tax, I never once mentioned my income.

The question is, why should we be taxed higher in Scotland than those that are in England? It penalises aspiration. You're just as well putting a sign up at the border saying "Welcome to Scotland, the highest taxed region of the UK"

If a top foreign brain surgeon or cancer specialist has the option of working in Manchester or Glasgow, he will look at the financial impact, the taxation levels and no doubt choose Manchester. The same applies for the top Engineers, Scientists, Businessmen etc, we are in effect.

Why did Sturgeon back away from upping the top tax band from 45% to 50% income tax? She said it herself, she is scared of losing these taxpayers to England as the subsequent loss of tax revenue would create a huge black hole in Scotland's budget.

Someone earning £100k will pay £29,000 in income tax alone never mind national insurance. Someone earning a fairly average median wage of £20k (applies to a lot of Scotland) pays just £1800 in income tax. Do the maths, lose 1 x £100k earner and you need 16 x £20k workers to replace what he was paying in income tax. Someone earning £200k will pay a whopping £76k in income tax. Lose him and you would need 42 x £20k workers to replace him with.

Scotland cannot afford to lose those that contribute the most. The message should be loud and clear, if the differences between Scotland and England open up so they are substantial, then people will be switching homes on paper to avoid paying Scottish income tax. Look at the North Sea industry, lots come to Aberdeen/North Sea to work and then get the train home to England after a rotation/shift. If you have a family member or friend living south of the border line, all you need to do is register on their electoral role, tell your employer your 'new address' and you bypass Scottish tax altogether. This is what will happen if you push and squeeze higher earners too much and hence why Sturgeon never went down that path with the 45% band.

You say move down south, see if its any better, but look at the maths above, 1 x £200k earner is the equivalent of 42 x £20k earners. Now multiply those figures for the numbers that may leave.

I'll leave you with this....

Suppose that, every day, ten men go out for beer and the bill for all ten comes to £100.
If they paid their bill the way we pay our taxes, it would go something like this...


The first four men (the poorest) would pay nothing
The fifth would pay £1
The sixth would pay £3
The seventh would pay £7
The eighth would pay £12
The ninth would pay £18
The tenth man (the richest) would pay £59
So, that's what they decided to do.
The ten men drank in the bar every day and seemed quite happy with the arrangement; until one day the owner threw them a problem.
"Since you are all such good customers," he said, "I'm going to reduce the cost of your daily beer by £20." Drinks for the ten now cost just £80.
The group still wanted to pay their bill the way we pay our taxes.
So the first four men were unaffected. They would still drink for free.
But what about the other six men? The paying customers? How could they divide the £20 windfall so that everyone would get his fair share?
They realised that £20 divided by six is £3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer.
So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay.


And so the fifth man, like the first four, now paid nothing (100% savings)
The sixth now paid £2 instead of £3 (33% savings)
The seventh now pay £5 instead of £7 (28% savings)
The eighth now paid £9 instead of £12 (25% savings)
The ninth now paid £14 instead of £18 (22% savings)
The tenth now paid £49 instead of £59 (16% savings)
Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings.
"I only got a pound out of the £20," declared the sixth man. He pointed to the tenth man, "But he got £10!"
"Yeah, that's right," exclaimed the fifth man. "I only saved £1 as well.
It's unfair that he got ten times more than I!" "That's true!!" shouted the seventh man. "Why should he get £10 back when I got only £2? The wealthy get all the breaks!"
"Wait a minute," yelled the first four men in unison. "We didn't get anything at all. The system exploits the poor!"
The nine men surrounded the tenth and beat him up.
The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they
discovered something important. They didn't have enough money between all of them for even half of the bill!
And that is how our tax system works.

The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just
may not show up any more. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.
For those who understand, no explanation is needed.
For those who do not understand, no explanation is possible
Now who's round is it ?????

Edited by Leo-RS on Thursday 24th March 12:24
Excellent explanation. Now, who in England / Wales / N.I. wants a lodger "on paper".

emicen

8,690 posts

224 months

Thursday 24th March 2016
quotequote all
jith said:
- I shall not remain silent and be thought of as an idiot, I shall open my mouth and remove all doubt
- Fantastic failure in understanding taxation
- Its all Westminster and Europe's fault, even though we want to be ever closer to Europe and the SNP haven't agreed to follow through with pledges to help small businesses laid out in the latest budget
- I don't have the ability to explain why I believe what I believe, so I'm going to shriek about insulting my intelligence until the awkward facts go away
- Sturgeon wants to allow in loads of immigrants but you wont like England cause its full of immigrants, I'm not sure if I'm racist, more blinded by my religion so I don't see the obvious contradictions in what I'm saying
- I have no real knowledge of history, I'm going to ignore the Union saved a bankrupt Scotland, ignore the centuries of support since then, focus heavily on the past 30 years where we'd have been better alone, pretend that £15bn a year in the hole right now with oil on its arse isn't a problem, ignore the reality of taking on our share of debt with a bigger deficit than the rest of the UK


J
FTFY

Leo-RS

Original Poster:

288 posts

163 months

Thursday 24th March 2016
quotequote all
emicen said:
jith said:
- I shall not remain silent and be thought of as an idiot, I shall open my mouth and remove all doubt
- Fantastic failure in understanding taxation
- Its all Westminster and Europe's fault, even though we want to be ever closer to Europe and the SNP haven't agreed to follow through with pledges to help small businesses laid out in the latest budget
- I don't have the ability to explain why I believe what I believe, so I'm going to shriek about insulting my intelligence until the awkward facts go away
- Sturgeon wants to allow in loads of immigrants but you wont like England cause its full of immigrants, I'm not sure if I'm racist, more blinded by my religion so I don't see the obvious contradictions in what I'm saying
- I have no real knowledge of history, I'm going to ignore the Union saved a bankrupt Scotland, ignore the centuries of support since then, focus heavily on the past 30 years where we'd have been better alone, pretend that £15bn a year in the hole right now with oil on its arse isn't a problem, ignore the reality of taking on our share of debt with a bigger deficit than the rest of the UK


J
FTFY
Hahaha, outstanding emicen

wings_over

52 posts

105 months

Thursday 24th March 2016
quotequote all
If you don't like it

Feel free to leave

Plenty of britnats south of the border

Leo-RS

Original Poster:

288 posts

163 months

Thursday 24th March 2016
quotequote all
wings_over said:
If you don't like it

Feel free to leave

Plenty of britnats south of the border
55% of Britnats north of the border too wink

jamieduff1981

8,040 posts

146 months

Thursday 24th March 2016
quotequote all
jith said:
Leo-RS said:
As of next year, Scotland's band will start at £43,387 and England's band will start at £45,000 which means anyone earning £45k+ in Scotland will be £323 worse off growing each year as the gap widens.


Edited by Leo-RS on Thursday 24th March 07:26
I can stay quiet no longer.

You poor soul. It is absolutely disgraceful that you will only be left with over forty three thousand pounds to live on. How the hell are you and your poor starving urchins going to manage on that? I mean it's only around eight hundred and forty quid a week!

You should try running a small business in this god forsaken, WESTMINSTER and Europe contaminated environment. I haven't had a wage for over a month.

Independence ideology?? Please don't insult my intelligence. If you don't like what is happening up here move to England where you will pay twice as much for property, spend half your life sitting in stationary traffic and share your country with millions of immigrants. How far do you think your extra three hundred and twenty three pounds will go there?

This country was well and truly screwed before the SNP took over, and that was the result of 300 years of Westminster rule. Ideology has nothing whatever to do with the simple act of disconnecting this country from the toxic management of Westminster. It can only benefit from that.

J
I'm a small business owner. It's not my fault your business or management thereof is poor. My having to pay even more tax to fund owners of non-profitable businesses suits you much more than it suits me.

To grumbledoak - what we were given the option of voting for in the Indyref was an option of financial ruin or giving the SNP the power to tax us more. There didn't turn out to be an option to leave things alone. The majority of eligible voters voted for the slightly less damaging option, but we still got fked for it because there are too many people who fancy leeching money from anyone who dares to try to provide for their families to prevent the SNP from staying in power to screw over those of us who aren't financial failures.

As for that wings_over character ... I struggle to imagine him or her as a functional adult.

"What do we want?"
"Someone else's hard earned income"
"When do we want it?"
"Now"




Edited by jamieduff1981 on Thursday 24th March 14:13

Jammez

667 posts

213 months

Thursday 24th March 2016
quotequote all
Leo-RS said:
I will ignore most of that as your rhetoric is completely irrelevant etc. etc.
Love that explanation - how have I never heard that before?

From someone seriously thinking about buying a house just south of the border!

ETA

Quote edited as unnecessary.


Edited by Big Al. on Thursday 24th March 20:48

Humper

946 posts

168 months

Thursday 24th March 2016
quotequote all
Leo-RS said:
. For the record, I never once mentioned my income.
£44K?..... wink

Ciaranrb5

19 posts

116 months

Thursday 24th March 2016
quotequote all
Typical and to be expected given SNP seem to now be showing there true colours.
I'm luck enough to be well into the tax bracket.
Multi million ££ companies pay a fraction of what the should people who earn a good wage get raped.

GetCarter

29,575 posts

285 months

Thursday 24th March 2016
quotequote all
wings_over said:
seriously offensive stuff
I had your post removed. (You know the one). Please respect people on this forum.

Dryce

310 posts

138 months

Thursday 24th March 2016
quotequote all
wings_over said:
If you don't like it

Feel free to leave

Plenty of britnats south of the border
Given the socio-economic berakdown of the yes vs no vote then maybe your attitude is at the heart of the taxation strategy.

When I graduated two thirds of my class headed down south. Of the current crop of the next generation of youngsters with ability that I know the majority are also now down south.

And really that's part of the Scottish problem. Not immigration - but emigration. An ongoing leakage of youth and talent.

They just need to lose a small % of 40% tax payers because of this and they will potentially wipe out any gains they they make from the increase from those who stay. Some people won't have to physically move to be lost to the Scottish economy - they'll just sort out shifting their notional residence.



fluffnik

20,156 posts

233 months

Thursday 24th March 2016
quotequote all
Leo-RS said:
I believe 16/17, the Scottish government levy a 10p in the pound charge on the income tax received by Westminster. From next year, I believe the whole lot goes to the Scottish government. National insurance is different though, this will always go directly to Westminster, Scotland have no control over NI.
Which is why "more powers" devolution is a poor substitute for independence.

The UK and its clusterfcensoredk tax code is something we'd all be better without. smile


Craigie

1,228 posts

185 months

Friday 25th March 2016
quotequote all
I feel sorry for anyone who is so motivated purely by money.
Forgetting politics or sides, someone whose sole focus is to the pound how much of their higher rate tax they may pay. That's a sad way to live your life.

Maybe have a thought for people with no income or not enough to pay tax on.
Maybe have a thought to the bigger things in life, quality of life, environment etc.

My brother moved south years ago and got trapped in negative equity property and is slogging his guts out as a high rate taxpayer just to try and get back to an even keel.

Grass is not always greener and certainly there is far more to worry about and consider than a couple of hundred quid tax differences.

Dryce

310 posts

138 months

Friday 25th March 2016
quotequote all
Craigie said:
I feel sorry for anyone who is so motivated purely by money.
Very few people across the political spectrum are not motivated by money.

However - I suspect that very few across that spectrum are motivated purely by money.