(UK) Public wants taxes that hurt the rich - Credit crunch provokes backlash against bankers

[Bozita]

Source: Guardian (UK), The Observer

Public wants taxes that hurt the rich
Credit crunch provokes backlash against bankers

Gaby Hinsliff, political editor
The Observer, Sunday 4 January 2009
Article history


Two-thirds of Britons want the rich to face punitive tax rates not seen since the 1980s, according to a new poll which suggests that the recession has hardened attitudes towards the wealthy.

Bankers are now seen second only to footballers as being overpaid, while seven in 10 think that ordinary workers should sit on remuneration committees setting executives' pay to ensure that high salaries are deserved.

The findings - in a poll for the think tank the Fabian Society, to be published this week - suggests that the credit crunch has provoked a backlash against the rich, with the public seeking retribution for alleged mistakes made by City figures.

The findings will encourage Labour MPs who want Gordon Brown to go further in next spring's budget and rebalance the tax system in favour of more modest earners.

Read more: http://www.guardian.co.uk/politics/2009/jan/04/fabian-society-poll-taxation-wealth

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Pitchforks, anyone?

[BelgianMadCow]

1. I'll bring the boiling oil

and yes this is a prevailing sentiment.

[depakid]

2. Reverse Thatcherism....

[MannyGoldstein]

3. Top Tax Bracket Under Eisenhower: 91%

And he, and both Republican-controlled houses of Congress were fine with that.

After accounting for lower taxes on unearned income (aka capital gains), the wealthiesty Americans paid about 50% in taxes back then. Now it's 17%.

Un-fucking-believable that we in the Middle Class have allowed this.

[pattmarty]

4. The big problem with what you stated (which is the truth) is.......

........where in the hell do you hear about this????? Nobody in the lower class or most even in the middle class know the absolute fucking we have been getting since st ronnie. The newspapers wonder why they are not "relevant" anymore? Try some honest reporting for once, like this.


Edit to add: Look at the corporate rates also since Eisenhower to st ronnie.

[MannyGoldstein]

8. I'm Not Sure That Most People Can Handle The Truth

Usually when I post this, even on DU, I get a few agitated responses that 91% is extreme and couldn't actually work. The fact that it actually *did* work (and the economy was great and the Middle Class prospered) doesn't seem to ring a bell for everyone, even on this lefty board. For some reason, a lot of people have a hard time accepting smack-you-over-the-head evidence.

[tridim]

5. So do we.

[harmonicon]

6. maybe Brown can save his ass after all

.... by doing something that the people actually want! That would be radical... now, if the US would do the same, we could possibly at least start to dig ourselves out of this shit hole that we're in now.

[T_i_B]

9. The best starting place IMHO...

...would be a windfall tax on the profits of privatized utility companies (as Labour did in 1997). I think that the British government missed a trick when they failed to do this last year.

http://www.compassonline.org.uk/campaigns/campaign.asp?n=2773

[Joe Chi Minh]

14. He needs to recentralise government, most notably taxation, abolishing

all flat taxes without exception, and income tax on the poorer folk; then raise taxes significantly on the well-off, particularly the richest. (Don't let the peevish billionnaires take their money out of the country). Otherwise, it looks like Mad Max 5, apparently, in pre-production, will come out as a documentary, before release of the fictional film

Nation-wide distribution of a minimum of staples should be organised, and supply of water, gas and electricity secured, preferable by re-nationalisation. Also, public transport should be re-nationalised and new vehicles manufactured.

[OffWithTheirHeads]

7. Pitchforks! Get your red hot pitchforks here!

Fuck the rich! Behind every big fortune is a big crime.

[Buns_of_Fire]

10. Or maybe just PLAIN forks. And knives.

Sumbitches OUGHT to be tasty - they've been fed on the best all their lives.:evilgrin:

[bread_and_roses]

11. Notice the biased language in this article, too

Most glaring is the automatic use of the descriptor "punitive" for higher tax rates - as if there were no question that such rates would be a "punishment" that would "hurt the rich." Then, the headline uses the phrase "taxs that hurt the rich." The actual question, provided in quotes in the body of the story, used the phrase "FAIR SHARE towards investment in public services" - a very different and more sustainable frame for the responses. If there is a question that actually uses the phrase "hurt the rich" it should have been quoted if the writer were going to use it in the headline.

I don't consider this a minor point. The notion of retribution - even revenge - is easily undermined as anti-social, based in individual anger and resentment, and even irrational. The concept of paying a "fair share" expresses a basic value affirming shared social responsibility.

[muriel_volestrangler]

12. Well spotted - here's the actual news release from the Fabian Society

http://fabians.org.uk/general-news/general-news/fair-tax-poll

Nothing about 'punitive' there. What it does say is that 69% supported a tax rate of 50% on earnings over £250,000. Not what I'd call 'punitive'.

[emad]

13. Just remember the exodus of the Non-Doms when Brown threatened

to levy a £30,000 tax on them.

Hiking personal taxes for the rich is pure madness and would only see a return to offshore tax haven hell for the government.

Brown should consider halving Corporation Tax. That would create a huge influx of big foreign firms moving their HQs to the UK.

He could also move to a flat 17% rate of tax for everyone (similar to the Russian system), saving himself billions annually in Treasury admin costs of the hideously complicated personal tax system currently in place.

Changing the income tax system to a lifetime tax contributions system would mean that, say, the first £100,000 ANYBODY ever earned during their lives would be tax free.

Income would only begin to be taxed once £100,000 had been earned over whatever number of years that would take.

This would impact favorably viz the black economy and encourage everyone to 'go legit'.

And Brown could save himself £100 billion by getting rid of those stupid Quangos that have yet to make one iota of difference to anybody's life.

[Joe Chi Minh]

15. Rubbish he could forbid removal of substantial amounts of money from the country, before

announcing his plans. But the quangos should go, anyway. They're stealing from the public to favour party supporters. It's also possible that Western leaders could pressure the offshore banks to reveal their deposits and the depositors.

[emad]

18. "forbid removal of substantial amounts of money"?

Been there, tried that, failed miserably.

As for "Western leaders could pressure the offshore banks to reveal their deposits and the depositors" - this is a foolish pipe dream as many governments have found out to their cost.

Switzerland, top global banking secrecy hotspot, has recently moved towards the smallest of disclosure compliance it could possibly muster despite 60 years of UN and other pressure. It remains the Europe's top financial hideyhole closely folowed by Luxembourg, Lichtenstein, Monaco and San Marino.

The UK's Channel Islands have begun some compliance with EU disclosure requests but still will not reveal information about their partnerships in offshore centres such as the Dutch Antilles, the Cayman Islands, Bahamas, other Caribbean islands.

And try getting disclosure from some of the Arab states such as Bahrain, which runs one of the world's largest offshore banking centres. You'd have better luck trying to break into Fort Knox.

[Joe Chi Minh]

16. I don't believe I have ever read anything so benighted and regressive here since

I first visited the site.

After WWII, the top income-tax bracket in the UK was 95%. Well, the people had been cleaned out - just as they have today. But do you think they would have had to sell their ocean-going yachts?

[emad]

17. This socialist polemic is fundamentally bankrupt.

Hiking personal (income) tax for the top earners has been proven to be an ideological disaster.

Check out the Russian economic success story ever since the introduction of the flat rate of income tax.

[LeftishBrit]

19. The Russian economic success story?

Well, I suppose the Mafia have been doing rather well...

[Lydia Leftcoast]

20. The Russian economic success story?

Not according to my friends who travel there frequently for humanitarian projects.

It's a typical conservative-style "economic success story": A few hundred more millionaires and declining living standards for everyone else. Sort of like what the U.S. and Britain have had.

[Nihil]

21. I seem to recall a reference to that in "Shock Doctrine" ...

... and certainly wouldn't call it a "success story" ...
:shrug:

[emad]

22. Last year BBC Newsnight ran a story about how Russia's black economy

had been halved since the introduction of the low flat rate income tax system which had shown an 80% increase in new tax registrations.

Other former Eastern block countries such as Estonia and Lithuania, Bulgaria, Albania, Czech Republic, Georgia, Kazakhstan,
Kyrgyzstan, Latvia, Macedonia, Romania, Serbia, Slovakia and Ukraine have also introduced flat rate tax systems to counter the black economy and reduce the expenditure of highly complex multi-tiered systems such as that of the UK.

[muriel_volestrangler]

23. A multi-tiered tax system isn't that complicated

It only tends to get that way if you treat different kinds of income in different ways, eg earned income at 40%, dividend income at 32.5%, and so on. And a lot of the complexity of the UK system is allowances and deductions.

If you say "your income is £A; the tax free allowance is £B; the rate is C%; you pay £D", there's only one extra step in calculation to say "the rate above £E is F%". You can do it in a minute, or a fraction of a second on a computer spreadsheet.

[emad]

24. Yes. But the UK tax system has been made deliberately fiendishly complex

and its admin costs have soared way beyond justifiable bureaucracy.

My point is that those countries that have introduced a single flat rate have reported substantial changes from previous black ecomomy untaxables to new 'legit' taxpayer registrations.

Tackling the UK's black economy by a radical overhaul of the antiquated tax system should be a priority in any new economic plan.

Dumping useless quangos would also help.

Slashing corporation tax would attract much needed new investment.

Adopting a lifelong tariff for personal taxation and scrapping obsolete regulations about qualifications for a state pension would also get things moving.

[Albus]

25. The tax system has to be fiendishly complex

If it wasn't then how could we justify all the civil servants and politicians that are needed to devise and run it?

If it was simplified, what would become of them?

They would be cast aside, surplus to requirements, and left destitute!

Think of their families!

Think of their poor kiddies!

You evil Tory bastard!