incomes and tax paid Flashcards
what % of UK income tax is paid by the highest earning 10%
55%
What % of UK income tax is paid by the highest earning 1%?
25%
what do you have to earn to be in the top 1% and top 10%
Over £55,000 p.a. and over £155,000 p.a.
But how important is income tax to the govt’s income?
Income tax is the largest single tax; but it is only about 27 per cent of the overall tax take. VAT and National Insurance Contributions combined account for considerably more, and bear much less heavily on high earners (let alone the asset-wealthy).
Based on household income, what do the top 10% have coming in and how much tax do they pay on it?
the top 10 per cent of households have gross income averaging £107,500, of which they pay £35,000 - just under a third – in all taxes, direct and indirect.
Based on household income, what does the average household have coming in and how much tax of all kinds do they pay on it?
The average household has income of £37,700, of which they pay £12,700, or just over a third, in taxes of all kinds
why is council tax currently highly regressive?
Because it represents a much larger fraction of the value of the average property than of a mansion.
what was the top tax rate before the Thatcher / Reagan revolution and what is it now?
Over 70% in both US and Uk before 1980s, cut to 40% within a decade
If we measure by “taxes paid less benefits received” (all taxes) paid, what is the net contribution of the richest and poorest fifth of the UK population?
The poorest fifth of households contribute minus £2,151 a year, on average. (-46% of original income)
The richest fifth of households contribute plus 24,259 a year, on average (+33% of original incme)
What is the UK govt’s annual benefits bill and what % of it is for unemployment benefit
£200 billion a year - of which 3% is for unemployment benefit (pensions account for about two thirds)
what is the total personal wealth of the UK and what share of it is owned by the richest 10% ?
£9,000 billion (nine trillion £) , with £4,000 billion (44%) owned by the richest 10%. (the bulk in property or pensions, and some in financial assets and objects such antiques and paintings)
what % of the UK’s wealth is owned by the bottom half of the population?
9%
What would a wealth tax do and how would it work?
A one-off tax of 20% on the wealth of the top 10% would pay the national debt and dramatically reduce the deficit, since interest payments on the debt are a large part of government spending.
A wealth tax of 20%, graduated so the very richest paid the most, would raise £800bn. It would not have to be paid immediately. The richest 10% would have only to assume liability for their small part of the debt. They can pay a low rate of interest on it and if they wish make it a charge on their property when they die. It would be akin to a student loan for the rich.
There are strong economic arguments for this tax. A key problem for the British economy is that much of the nation’s resources have been directed into inflated property values, which is where many of the bonuses ended up. This is in effect dead money but the tax would have the effect of re-circulating it as government spending, which could stimulate growth. The deficit would thus be further reduced as the unemployment resulting from the proposed cuts would be avoided – thus no increase in unemployment pay and no loss in tax revenue from the unemployed. This proposal offers a real alternative, to move debt off the government’s books, using money that is largely trapped in the housing market, from people who will not miss it.
What is the 2013 minimum wage and what is Labour’s ‘living wage’?
£6.31 and £7.65
What % of Britain’s 25 million workers are paid less than the ‘living wage’?
21%
