Re: UK's top earners face 45% tax from 2011
- From: "AleXX" <nodeal@xxxxxxxxxxxxxxxxxxxxxxxxxxx>
- Date: Wed, 26 Nov 2008 09:02:06 +0800
Good move because people by then might lost interested in earning more than
S$342,000 per year. May be S$341,999 just S$1 short falling out of the 45%
tax category? More people earning less so that wealth will be distributed
more equally among the people?
"kingkong" <hahaha@xxxxxxxxx> wrote in message
UK is planning 45% tax for UK citizens earning S$342,000 a year from 2011.
Is this a good move ?
A better way would be to keep tax rate at current rate or even reduce it
and follow the Americans by taxing UK citizens as well as UK corporations
earning income overseas. A nominal 5% would be good enough since there are
millions of UK citizens working in foreign countries.
Cutting VAT from 17.5% to 15% for 13 months won't do a thing if ordinary
UK citizens don't have money to spend, thought politically, it look very
UK should find some ways to get overseas UK funds flowing back to UK,
start investing and create jobs. Likewise, Singapore should do the same
Move may trigger flight of talent, businesses overseas
By JANE MOIR
BRITAIN's top earners are set to be hit hard in the pocket as future tax
increases are to be introduced to pay off the country's debts.
This has prompted fears that the move will trigger a further flight of
talent and businesses overseas.
Workers earning more than £150,000 (S$342,935) a year are looking at
a 45 per cent tax rate by April 2011, with critics warning that the hike
will force many businesses to consider moving offshore and may weaken
Britain's ability to attract talent.
The increase was announced in this week's Pre-Budget Report by Chancellor
Alistair Darling. Describing the current environment as 'extraordinary,
challenging times', he announced a £20 billion fiscal stimulus to
kickstart the economy.
Slashing VAT from 17.5 per cent to 15 per cent for 13 months at a cost of
£12.5 billion, the aim is to get consumers spending again after a
credit crunch brought the economy to a virtual standstill. The decision to
cut VAT has cost the government: borrowing will rise to £78 billion
this year and £118 billion in 2009, or 8 per cent of GDP.
Plans to soak the rich in 2011 will help pay for this stimulus package,
but the move is likely to face hefty criticism. Already, lobby groups such
as TaxPayers Alliance are warning the move to increase the top rate to 45
per cent could hurt Britain's attractiveness.
'It definitely threatens Britain's competitiveness and actually risks
harming the country's ability to recover from this financial crisis,'
claims TaxPayers Alliance campaign manager Mark Wallace.
'Other countries will be streamlining their tax systems,' he stressed.
There are an estimated 350,000 UK residents above the £150,000
threshold. 'What we are seeing is a real scaling down of the benefits of
working harder,' Mr Wallace warned.
A number of companies have decided to leave Britain over the past few
years as uncertainty over corporate tax, and in particular how foreign
subsidiaries will be taxed, forced many businesses to reconsider their
options and ponder an overseas move. 'Now more than ever businesses are
evaluating where they should be based,' Mr Wallace says. 'Also, if you
make it hard for people to attract talent, it will reduce the incentive to
be based in Britain.'
A decision to increase the top rate bucks a global trend, according to a
survey by KPMG International.
On average, the top rates of personal income tax globally have fallen by
2.5 per cent in the past six years. Britain's 45 per cent is, however,
still below the top rate in Germany and the United States.
KPMG's David Kilshaw noted: 'The Treasury clearly needs to find money from
somewhere but the UK has to remain competitive at a time when the
workforce is becoming more mobile.
'Given the recent changes to non-domiciled taxation, this is a further
potential challenge to London's position as a leading global financial
Workers in the mid-tier earning brackets are also facing steeper cuts in
their pay packets. Those earning £100,000 to £106,500 and
£140,000 to £146,500 a year are to see an effective 50 per cent
tax rate under the new proposals.
This is because their personal allowance will be gradually cut while
national insurance payments will increase, biting further into their
annual salary. Bonus payments will be included in the tax net.
- UK's top earners face 45% tax from 2011
- From: kingkong
- UK's top earners face 45% tax from 2011
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