Burnham to remove VAT from household electricity bills that seems great!

[JohnW2]

It needs to be raised...

It's an issue which has been discussed and play with for years. Traditionally, the personal allowance rose every year, albeit not always enough to keep up with inflation, but, more recently the Tories froze it for a number of years and, perhaps rather surprisingly, the current Labour government then extended that freeze.

I would add that raising the personal allowance (thereby increasing the threshold below which one will pay no income tax at all) is not a particularly effective way of achieving what you would presumably like to be achieved, because it reduces the amount of tax one pays at one's highest marginal rate. As a result, higher paid people benefit quite a lot more (up to double the reduction in tax paid, with current rates) from an increase in personal allowance than do low-paid taxpayers.

 

[cdbe]

 

[JohnW2]

I work part time. Approx 15 to 20hrs a week.

Assuming you are paid pro-rata to your hours (and that you have no other income), if you're paying tax on 15 hours' work, it presumably is a relatively 'high paid' job?

It kills me. It is not easy. I like to work. Never claimed any benefits.

Good for you - and that's a sincere, not sarcastic, comment.

The gov needs to raise the tax threshold. They need to tax the rich more not feed them more money!

As I recently wrote, raising the threshold will benefit the higher-paid quite a lot more than it it benefits the lowest paid of taxpayers.

It's ALWAYS the worst off that continue to be worse off.

See above. Raising the tax threshold would (slightly) increase the 'money in the pocket' gap between the low-paid and high-paid taxpayers, since it would benefit the higher-paid ones a bit more.

New PM is nothing new. Same old bs. We need a new government. Who? I really don't know to be honest.

I really don't think it makes much much difference which party (or parties) is in power, and even less who the PM is. Any of them would face the same problems, and would have the same very limited options available for addressing them, at least in the short- and medium-term. The current government is particularly daft, having tied their own hands behind their backs with some crazy, but totally unnecessary, 'manifesto promises', seriously reducing their 'options'!

In my opinion, the problem over the past several decades is that expectations have grown high, but with no real corresponding increase in money with which to pay to satisfy those expectations!

 

[Koolpc]

No, not high paid job.

However much 'extra' low paid would get is a bonus. You can't not increase the threshold because the rich will get richer. The government need to address the issue.

 

[JohnW2]

No, not high paid job.

You haven't told us how much tax you're paying for your 15h/week work, but even if it's only 1p tax per year, the 'full-time' (40h per week) equivalent of the pay for your job would be about £33,520 p.a. - which I would not call particularly low (the average for full-timeworkers is currently about £39k). However, if (as seems to be he case) you feel that you would benefit significantly from an increase in the tax threshold, then you would presumably currently be paying a lot more than 1p per year tax - in which case the full-time equivalent of whatever you're being paid would be appreciably greater than £33,520 p.a.

However much 'extra' low paid would get is a bonus. You can't not increase the threshold because the rich will get richer. The government need to address the issue.

The arithmetic has to work. If the tax threshold were increased so the amount of tax paid by both low-paid and high-paid people decreased (more so for the latter), then that 'lost'government revenue would have to be addressed either by some increase in some other taxation (with some people paying that increased tax) or else by 'cuts' in some government-provided services - so what other taxation would you like to be increased (and who would you want to pay that increased tax) and/or what would you like to be cut.

Oh ... and there is a third option - fund the increase in tax threshold by further borrowing, thereby kicking the issue of replaying that debt down the road to become a problem for future generations!

 

[Koolpc]

Offload the difference onto the rich......

I earn min wage....

 

[mikehammer69]

Offload the difference onto the rich......

I earn min wage....

I don't think you get money from taxing the rich

It's mostly a myth about taxing them

 

[Koolpc]

I don't think you get money from taxing the rich

It's mostly a myth about taxing them

Well, something needs to change

 

[Murdochcat]

Well, something needs to change

It wouldn’t take much work on a spread sheet to increase the tax threshold, then adjust the higher bands to simplify to system AND raise the amount of taxes raised.

 

[JohnW2]

It wouldn’t take much work on a spread sheet to increase the tax threshold, then adjust the higher bands to simplify to system AND raise the amount of taxes raised.

Raising the threshold (personal allowance) is just one way of 'reducing income tax, but I suspect that it would rarely be the 'best' way. The simplest alternative would simply be to reduce standard rate tax - and that would have the advantage (over a threshold increase) of not letting higher-rate taxpayers pay 40% tax on less of their income.

If your spreadsheet were to result in an increase in amount of tax collected (presumably from higher-paid people), I imagine that would qualify as an 'increase in income tax' (for some people) -something which is theoretically precluded by the government's crazy promises in the manifesto they have forced themselves to work to!

 

[ericmark]

If you tax the rich, they leave the country, and you lose it all.

 

[noseall]

If you tax the rich, they leave the country, and you lose it all.

You mean the ones that have their companies domiciled in places like Luxembourg yet make all their profits from the UK and only visit here when their yacht need re-stocking with June strawberries?

Tell them to close the door.

 

[Murdochcat]

Raising the threshold (personal allowance) is just one way of 'reducing income tax, but I suspect that it would rarely be the 'best' way. The simplest alternative would simply be to reduce standard rate tax - and that would have the advantage (over a threshold increase) of not letting higher-rate taxpayers pay 40% tax on less of their income.

I wasn’t suggesting it was the best way but our tax system plus the thresholds make no sense.

I was advocating the simplest way, that every body could understand it

For instance, the personal threshold should be no more or less than the basic new state pension. The higher rate for pensioners needs to be lowered to take into account free bus passes, th licences etc

The tax free starting rate needs to be higher, then the 20% plus Ni, then the 40.% plus the reduced rate NI, remove the £100k taper band which effectively means people are paying up to 60% plus reduced rate ni, then the 45% band kicks in

This is why so many high earners put money in their pensions

 

[ericmark]

th licences etc

Need to be on pension credits to get free TV licence at 75.