Should there be higher tax brackets for serious high earners?

Question

Think celebs and sports stars.
Perhaps 60% over £200,000 per year then 80% over £1,000,000 per year? I think so.

The point im trying to make is the rich get richer and the poor get poorer. The extra taxable income could be used to improve education, housing and eradicate poverty.

By the way i am in the 40% tax bracket as i earn over £40000 ($75000) per year.

I have no problem with people being paid for being good at what they do if what they do has some worth (celebs, sports stars etc). Compare the time and effort say a top lawyer may have put in over the years compared to say Wayne Rooney - no comparision.

To stop the brain drain of the 80's where high earners left the UK for other countries where they could earn more? British Domiciles should always be taxed in Britain regardless of where they live - simple. The economy would balance out as the pursuit of wealth would no longer be the drive rather the pursuit of knowledge and helping people would take over.

For information i earn over £50000 per year, have plasmas, a sports car, big apartment, a place in Spain etc so im not wanting. I just think we are forgetting our fellow man in todays day and age.

Answer 1

The problem is there are too many ways around income tax. If you look at how the Spice Girls avoided tax when they were raking it in you will see what I mean.

I'd like to say yes, but the reality is it doesnt work.

Answer 2

Britain tried this in the past (1970s) and all the high earners left, so instead of 40% of a lot we got 90% of nothing.

The trouble is, once the taxman's getting more than the worker, there's much less incentive on the worker to work. The other thing is that increasing the tax rate on the rich is (a) small beer in terms of total revenue (because there are so few of them) and (b) rather pointless because they have good accountants and end up getting out of paying taxes anyway.

If people don't like it, they should instead show their displeasure by not supporting these people. Don't pay £30 to watch a football game (or £10+ a month to Sky to watch them at home). Don't buy new records (listen to the radio). Don't watch the TV shows of talentless celebs.

Finally, I'd say don't live in envy - be glad for what you have and don't let the gloss be taken off it by comparing yourself to what extra others might have. They're probably miserable for other reasons anyway.

Answer 3

Personally if they raised our taxes that high my husband and I would close our companies, leaving 30+ families unemployed. We would take OUR cash and retire. I don't think we would be alone, If we make money we employ people thus driving the economy. It was our risk to start businesses in the first place if it wasn't for " Rich" people like us where would you work? We pay our taxes and donate to charities. We both work 80+ hours a week [ AT TIMES IT SEEMS LIKE 27/7 not a typo] . If we take a weekend or a week now and then cut us some slack { we go away and let others take care of us ] spending our money to drive the economy some more. The more we spend the more someone else earns . I don't see what your problem is.

Answer 4

I have mixed feelings on this one because there are one or two problems with taxing all the high earners massive amounts.

The first question is, why should i pay more for my bin to be emptied than someone else who earns less than me?
Should i pay more for the same streets to be cleaned, for the police to catch the same burglers?
Imagine you went to a restaurant and your bill was more expensive than the next tables for the same food just because you earned more than them,
Do we carry that on everywhere? Should a pint of beer be more expensive at the bar because you earn more money than the man next to you?
Of course not, you cannot make one person pay more for something because they earn more.

Take a man earning £10K a year, he will have little money to spend on clothes, cars, electrical goods, his house will probably be smaller, etc.

Now, all the high earners will spend much more, the TV they buy will be a big wide screen costing thousands, maybe a 30grand car, all these things make this country profitable, they keep industry and retail moving. Take away a huge chunk of what they earn and business dealing with high end goods will suffer badly.
That in turn affects all the employees of thse companies, shop workes, factory workers, builders, the low wage earners.


The biggest problem will come from a repeat of the brain drain which happened in the 80's, the top people of this country realised that salaries in other countries were 10 times what could be earned here and so they started to leave for America, Europe. etc.
The same will happen, why would a high earner stay here when they are going to have to pay such high taxes? This is why lots of very wealthy people move, all the F1 drivers are in Monaco for example.

I've tried to simplify this as much as possible, it is a very complex argument.

We live in a diverse society, we need a mix of low and high earners for it to work, to lose one section of the population would be disaster for us all.

Answer 5

The difficulty with this sort of proposal is that it stifles ambition. In the UK we had seriously high income tax rates for high earners some years ago and we suffered a mass migration of high earners, mainly to the USA.

What prompts the question is the obscene amounts of money earned by footballers and untalented pop "stars" like the Spice Girls.

However, you can't pick and choose which high earners you are going to tax, so if you fix a level at (say) £200,000, EVERYONE in that bracket pays the extra tax. Our commercial organisations need to attract the very best people, and it is no use taxing them out of the country - no one is going to earn £200,000 in the UK and be taxed at 60% if he/she can earn the same in the US and pay less tax (as well as enjoy a cheaper standard of living).

What really galls is when high earners fail to spend it - Paul McCartney springs to mind. His huge fortune is worthless - the only value in money is in spending it. Elton John got a load of criticism for spending tens of thousands of money on flowers, but all of that money went back into the economy.

The florist spent it and so it went on. McCartney is as mean as could be and so his money is effectively removed from the economy. If a way could be found to remove money from these sorts of hoarders by taxation, all power to the Chancellor's elbow.

Answer 6

Personally, I don't think so. Why should we seriously penalise someone for (in the majority of cases) being good at what they do and working hard to have got to a position where they earn fantastic sums of money for doing it?

Anyway, if this sort of thing was introduced, these people would only find ways to avoid paying the huge rates of tax (offshore accounts etc)

Answer 7

How can anyone possibly think that is fair, or is it just that you'd like to stick it too anyone who has more than you? I'm retired, have less than the average, but STILL think that is wrong thinking. The same percentage for everyone, would produce enough, as it is, 40% pay nothing.

Answer 8

Not in the U.S. I'll bet if you earned that kind of money, you would feel differently. Punishing people for being successful is oppresive

Answer 9

it is really obscene when we see people earnings vast fortunes, paying little tax, whilst the rest of us have to carry the burden.