Tax and spend

I wish someone with right-wing leanings could explain to me why it is so important for rich people to pay less tax than the less well off members of society, because it is a concept that I really do not grasp. I understand why they claim that more tax is collected if the rich pay lower rates, although I don't necessarily buy that. I also know of the arguments about it encouraging entrepreneurship which is a false argument because if you tax people a little bit more they’ll look for opportunities to earn even more money to compensate. So I really don't see any of their tired arguments as justification for lower taxes. It is like the government saying "we don't have a very good arrest rate for muggers so we're going to make mugging legal". Morally it is indefensible and mathematically it is questionable.

One of the problems we have with our tax system is that it is so unfairly weighted towards those in society that are less well off. We are virtually all taxpayers as I’ve explained before. Very few escape apart from the very rich and the insane. Tax should always be equally about two things: fairness and revenue collection. A tax regime has to be seen to be fair as well as being fair but it must also be effective in revenue collection. At present we have neither. Our tax system is far too complicated which enables the rich to avoid paying what they should. It is my belief that a simpler and fairer system would actually increase tax revenues.

Okay, redistribution of wealth is still not as popular in this country as it should be but that is not surprising as the rich expend a lot of energy and money on propaganda to hoodwink the population into believing that a large gap between rich and poor is desirable. And, sadly people fall for it. Redistribution of wealth, financing the mechanics of state and paying for measures to promote social mobility are what taxes should be for, with the emphasis on taxes applied to income rather than spend. When you tax spending this disproportionately hits the less well off, those that can least afford to pay taxes. If we had less of a divide between those at the top of the earnings ladder and those at the bottom then differing rates of tax wouldn’t be so necessary but unfortunately UK companies would rather get away with paying most of their staff the bare minimum rather than generous wages so that they can reward those few at the very top; it’s pure capitalism/market forces which as we know doesn’t work for the majority of people.

I think the sad thing is that the fair and equitable redistribution of wealth would ultimately create a stronger economy, with a higher GDP per capita and lower tax rates. What fat-arsed money men can’t seem to grasp is that if you put more money into the pockets of the less well off the less well off will spend it. When they spend, business booms and the economy grows. As the economy grows this generates more wealth and higher tax revenues. Beats quantitative easing every single time. It’s similar to the model that works reasonable well in Scandinavia. What’s not to like?

Tax-payers (work in progress)

‘Tax-payer’ is one of the many nonsensical terms currently bandied about by the media. A hateful term also highlighted by that reactionary organisation trading under the name of The Taxpayers’ Alliance. An organisation that no doubt draws sizeable support from Daily Mail readers. When the term ‘Tax-payer’ is used it is done so in a way to imply exclusivity. In reality though virtually all of the adult population are tax payers, along with many children. The largest source for revenue collection is derived from what people spend. Consumers are the only real tax-payers. Certainly 'for profit' organisations don't pay tax and neither does anyone assessed under the standard rate of tax.

Now before you accuse me of peddling some kind of Stalinist philosophy I urge you to remove those blinkers and consider the economy of this country from a different perspective than the one you normally adopt. If you are one of those "I don't work hard and pay my taxes to subsidise the feckless and the [enter persecuted minority of your choice]" Johnnies then I feel sorry for you. Please stop taking things at face value. That is the mark of an imbecile. Nothing is ever black and white, so please don't pretend that it is. Society’s make up is complex and multi-faceted, slogan-solutions are never the answer to a problem, if indeed there is a problem, which is often just a matter of opinion.

'For profit' organisations don't pay tax

Now this will fit nicely into the prejudiced view of many a hardened left-winger. But please just hold on a minute and let me explain. Now I’m not talking about tax avoidance or evasion here, although I have no doubt that many a corporation practises these dark arts. No matter how large or small the tax bill of any company is when the bill is paid it is not really paid by that company. I know that it is they that hand over the cash, but ultimately it is their customers that pay their tax bill. This is repeated all the way down the supply chain until it reaches the end. The end being the consumer. Companies don't really pay tax; they build it in to their pricing and effectively pass it on.

Standard rate tax payers working for profit orientated companies don't really pay tax either

I guess, with your pay-slip in hand, you might challenge me on this. Especially if you pay a sizeable wad to HM Revenue and Customs on a regular basis. But given we live in a market driven economy. Yes I know we don't like it. Wages are determined by the market and ultimately it is take home pay that drives wage levels so tax levels are immaterial.

What about the public sector?

I won’t even begin to try and explain the role of the public sector in all of this as this whole blog-post would end up being much more tedious than it actually is. Plus we could easily end up disappearing up some financial bum-hole in the process. That’s not putting the public sector down. The public sector plays a vital role and doesn’t deserve all the criticism it receives. The unjustified cuts that they are subject to are a result of charlatan economics.

There seems to be a misjudged paranoia amongst certain sections of the community that they are the only ones paying, whilst everyone else is taking. If true Tory intentions come into being, with all public services being privatised, I think people would be in for a big shock. If we were each billed for the services we use I suspect a large proportion of “hard working tax-payers” would find that they would pay out much more than they do now. Be careful what you wish for.

The average person on the Clapham Omnibus needs to stop accepting what they are fed about the economy. They need to scratch beneath the surface. To use a hateful business slogan they need to “think outside of the box”. Individual economic events don’t happen in isolation. Economic issues aren’t addressed by snappy on-liners.

The idea that you can measure a person’s worth is obnoxious, and to try and measure it in financial terms is immoral as well as laughable. We all make a contribution to society in our own individual ways. Don’t knock people because they are different or because the way they cope with life isn’t your way. Think before you cast the first stone, you might not realise that you are living in a glasshouse.

The Artful Dodger

#vat  

The rise in VAT is a regressive tax. That really is fact, unless of course you practice Orwellian Newspeak. Taxes on spending always hit those lower down the economic scale harder than those at the top. This is why the Tories love putting it up so much. The more you earn the less you notice the increase. Rob the poor to give to the rich is the well used and worn basis of Tory philosophy. As Ed Miliband is saying, “This increase in VAT, which kicked in at midnight, is the wrong tax at the wrong time”. You can’t argue with what Ed is saying, unless you are a money-grabbing tax-dodging Tory.

Some of the biggest reported money-grabbing tax-dodging Tories, I’m sure you’ll not be surprised to learn, sit in cabinet. That tax-increasing public-expenditure-cutting bunch of tossers that are running the economy into the ground. According to Left Foot Forward George Osborne is one of three cabinet ministers who have been accused of avoiding millions of pounds in tax, along with Andrew Mitchell (international development secretary) and Philip Hammond (transport secretary).

Today 38 Degrees planned a newspaper ad campaign - “George Osborne The Artful Dodger” - the ad highlights his alleged tax dodging antics. Unfortunately not every newspaper that they tried to advertise in was willing to take the business. Can you guess two that refused the ad?

Yes that’s right, the Daily Mail and the Daily Telegraph. It’s not surprising that the Mail (“the paper that supported Hitler”) refused it as they are so driven by ideology, but you’d have thought that the Telegraph would have taken the cash as even though they are dyed in the wool true blue they never usually shirk from exposing misdemeanours by anyone in any party

We’re all in this together, my arse.

Riding through the glen

The Robin Hood Tax campaign is a movement bringing together dozens of organisations that work to reduce poverty in the UK and overseas, and campaign to tackle climate change. They have come together during the economic crisis to campaign for a new deal between banks and society."

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