Net tax contribution

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Ben@Forest
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Net tax contribution

Postby Ben@Forest » 2 Jun 2019, 8:55pm

A topic spurred by the thought on another thread, rightly or wrongly, that one has paid far more into the tax system (which obviously isn't just income tax though that's the way people often perceive it) than one has taken out.

I read an article a few years ago that posited that an average person, who'd earned the average wage, with the average number of kids, average illnesses, average age of death etc was only just a net contributor to the tax system. I wonder how many of us actually are net contributors?

This isn't meant to be a loaded question, l don't think I'll reach the position of having earned the average wage throughout my working life, though l suspect it'll be a longer working life than most. But it's an interesting thought.

irc
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Re: Net tax contribution

Postby irc » 2 Jun 2019, 11:07pm

Sounds about right. 2018 stats on household income found that

The proportion of people living in households receiving more in benefits than they paid in taxes fell from 49.6% to 47.9% in FYE 2018


So a household on average income would on average be a slight net contributor.

https://www.ons.gov.uk/peoplepopulation ... ending2018

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Cugel
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Re: Net tax contribution

Postby Cugel » 2 Jun 2019, 11:12pm

Ben@Forest wrote:A topic spurred by the thought on another thread, rightly or wrongly, that one has paid far more into the tax system (which obviously isn't just income tax though that's the way people often perceive it) than one has taken out.

I read an article a few years ago that posited that an average person, who'd earned the average wage, with the average number of kids, average illnesses, average age of death etc was only just a net contributor to the tax system. I wonder how many of us actually are net contributors?

This isn't meant to be a loaded question, l don't think I'll reach the position of having earned the average wage throughout my working life, though l suspect it'll be a longer working life than most. But it's an interesting thought.


Personally I'm under no illusions concerning The State and it's necessity. Hobbesian, I am, on the matter.

There's a notion about in our supposedly individualistic society that, well, there is no society. Individuals who are deemed successful are "self-made" and somehow created their great fortune all by themselves. This is obvious nonsense.

Every human, without exception, relies on a vast plethora of aids, helps, infrastructure, institutions and just plain old other people, from parents, neighbours, workmates, schoolteachers, docs & nurses, policemen, soldiers & seamen, ..... and a thousand others who provide and support the minutiae of our everyday lives, from cradle to grave. Without a civil society our lives would indeed be "nasty, brutish and short". Perhaps Baron William Cutpurse and his counterpart The Duke of Assault would enjoy life but you and me ......?

One accounting of government taxes and benefits might look at tax paid and cash value of government services received. Good luck with calculating the value of government services received. I suppose it might be possible to add up the pounds for this and that but how to value the great opportunities and comforts of a civil society? They are worth far more than just the cash.

Citizen Cugel

irc
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Re: Net tax contribution

Postby irc » 3 Jun 2019, 12:16am

Cugel wrote:One accounting of government taxes and benefits might look at tax paid and cash value of government services received. Good luck with calculating the value of government services received.

Citizen Cugel


It's in the link I quoted. Benefits in kind include such things as hospital stays, free school meals and home care. Figure 2 - the yellow bar in the graphs is this item.

Though of course putting a value on the other benefits of society in general is harder.

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Mick F
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Re: Net tax contribution

Postby Mick F » 3 Jun 2019, 7:26am

These figures, are they converted from inflation and tax changes over the decades?
Back in the 70s, the tax rate was very very high in comparison to these days. My pay was good, but income tax took a big proportion of it.
Mick F. Cornwall

rjb
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Re: Net tax contribution

Postby rjb » 3 Jun 2019, 8:09am

From your salary, 20 to 40% goes in income tax, a further 5% in NI contributions, when you spend it 20% goes on vat then when you die 40% goes on death duties. This leaves between 15% and -5% to pass on to your heirs or charities. :lol: :lol:
The state wins the end. :(
At the last count:- Focus Variado, Peugeot 531 pro, Dawes Discovery Tandem, Dawes Kingpin, Raleigh 20, Falcon K2 MTB dropped bar tourer, Longstaff trike conversion on a Falcon corsa. :D

mercalia
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Re: Net tax contribution

Postby mercalia » 3 Jun 2019, 8:49am

rjb wrote:From your salary, 20 to 40% goes in income tax, a further 5% in NI contributions, when you spend it 20% goes on vat then when you die 40% goes on death duties. This leaves between 15% and -5% to pass on to your heirs or charities. :lol: :lol:
The state wins the end. :(



maybe not this guy
https://www.bbc.co.uk/news/business-48481320
or maybe the state will :twisted:

thirdcrank
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Re: Net tax contribution

Postby thirdcrank » 3 Jun 2019, 10:31am

Ben@Forest wrote:A topic spurred by the thought on another thread, rightly or wrongly, that one has paid far more into the tax system (which obviously isn't just income tax though that's the way people often perceive it) than one has taken out.

I read an article a few years ago that posited that an average person, who'd earned the average wage, with the average number of kids, average illnesses, average age of death etc was only just a net contributor to the tax system. I wonder how many of us actually are net contributors?

This isn't meant to be a loaded question, l don't think I'll reach the position of having earned the average wage throughout my working life, though l suspect it'll be a longer working life than most. But it's an interesting thought.


I don't understand the point you are making, especially how the calculation is made. If it's simply a matter of dividing the total tax take by the population to get a figure for what the average person puts in and then dividing public spending by the population to get a figure for what the average person takes out, then it misses all sorts. The most obvious omission is the part played by public borrowing. Another is whether the wages of a person on the public payroll count as "taking out." That's only at the monetary level. Once you start looking at non-monetary contributions, it's pretty subjective.

rjb
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Re: Net tax contribution

Postby rjb » 3 Jun 2019, 1:12pm

rjb wrote:From your salary, 20 to 40% goes in income tax, a further 5% in NI contributions, when you spend it 20% goes on vat then when you die 40% goes on death duties. This leaves between 15% and -5% to pass on to your heirs or charities. :lol: :lol:
The state wins in the end. :(

And I didn't factor in stealth taxes, such as council tax, fuel duty, new car levy, TV licence for some of us, :lol:
At the last count:- Focus Variado, Peugeot 531 pro, Dawes Discovery Tandem, Dawes Kingpin, Raleigh 20, Falcon K2 MTB dropped bar tourer, Longstaff trike conversion on a Falcon corsa. :D

PH
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Re: Net tax contribution

Postby PH » 3 Jun 2019, 3:15pm

rjb wrote:From your salary, 20 to 40% goes in income tax, a further 5% in NI contributions, when you spend it 20% goes on vat then when you die 40% goes on death duties. This leaves between 15% and -5% to pass on to your heirs or charities. :lol: :lol:
The state wins the end. :(

I note the funnies, but you do realise those figure are wildly inaccurate don't you?

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Re: Net tax contribution

Postby PH » 3 Jun 2019, 3:23pm

First point, it's a shame if anyone's contribution to society is measured in financial terms, then even more of a shame if, as in the thread that spurned this, someone's entitlement to a benefit needs justifying based on that financial contribution.
Second point, my tax contribution is more than the tax I pay, the company I work for pays tax on it's profits and my employment contributes to those.

Ben@Forest
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Re: Net tax contribution

Postby Ben@Forest » 3 Jun 2019, 6:21pm

thirdcrank wrote:That's only at the monetary level. Once you start looking at non-monetary contributions, it's pretty subjective.


And at that point you can't make the judgememt. My wife is a nurse, does that make her contribution to society of more importance than someone who imports luxury goods? What if the importer has created 30 jobs in retail? In this question l think only the financial aspect can be counted, everything else is too subjective.

PH
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Re: Net tax contribution

Postby PH » 3 Jun 2019, 7:00pm

Ben@Forest wrote: My wife is a nurse, does that make her contribution to society of more importance than someone who imports luxury goods? What if the importer has created 30 jobs in retail?

Or paid enough corporation tax to pay the salaries of several nurses...
In this question l think only the financial aspect can be counted, everything else is too subjective.

Counted to what aim? So that those who have paid more tax have a greater sense of entitlement? Which is demonstrated in the original thread. Or that those who have paid less, should feel less entitled? Regardless of any other contribution to society they've made? I think counting anyone's contribution is subjective, counting one element makes it more so not less.

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Cugel
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Re: Net tax contribution

Postby Cugel » 3 Jun 2019, 9:36pm

PH wrote:
Ben@Forest wrote: My wife is a nurse, does that make her contribution to society of more importance than someone who imports luxury goods? What if the importer has created 30 jobs in retail?

Or paid enough corporation tax to pay the salaries of several nurses...
In this question l think only the financial aspect can be counted, everything else is too subjective.

Counted to what aim? So that those who have paid more tax have a greater sense of entitlement? Which is demonstrated in the original thread. Or that those who have paid less, should feel less entitled? Regardless of any other contribution to society they've made? I think counting anyone's contribution is subjective, counting one element makes it more so not less.


Money's just money - a thing that doesn't exist in reality but only in the heads of humans who translate various real values into monetary value as a convenience. Often the convenience becomes rather inconvenient. No one likes a money-grubber or a miser. The fetishisation of money is somehow an ugly thing, leading to Philip Greenism.

There are all sorts of real values: goods such as bicycles and fruitcakes; services such as nursing or tax collecting; knowledge such as that of law or architecture; skills and abilities of many kinds; etc.. Who produces real value, who produces faux value (e.g. newspap, the anti-knowledge of reality-TV); who produces no value (e.g. a hermit); who merely takes value made by others but makes none themselves (e.g. a shareholder)?

Values can be compared quantitativly and qualitativly, perhaps put in a hierarchy, but without resorting to cash value. Some values can't be compared, unless you're an accountant - but they generally "know the price of everything and the value of nothing".

Vlaues change with circumstances and context. When climate change gets bad enough, gold will be worth nothing. My skill at woodworking will get me but a low wage today but what if capitalism fails and the factories all go bust? :-)

Cugel

thirdcrank
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Re: Net tax contribution

Postby thirdcrank » 3 Jun 2019, 10:29pm

For those who remember Bob Newhart I'll offer this pale pastiche.

Hello, you are through to the One Great Bean Counter, how may I help?

You want to check our records of your contribution to society?

OK, Name? Alexander? Let me guess. Alexander the Great? That's a new one: we usually get Napoleon.

OK. Not Great, so I'll call you Al.

Right, I see. Phlegming. Spitting's not much of a contribution, Al. Is that all you did?

Oh! Penny, shilling... Let me stop you there Al. You limeys usually say "Shilling, sixpence half-a-crown..." We need to get the price right first.

Harsh words, there Al, but you're the one going to Hell.

(For those who don't remember Bob Newhart, he did monologue sketches in the form of half a conversation. Sir Walter Raleigh ringing in to report sending a cargo of tobacco was particularly memorable.)