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Wait, wait, wait... The average middle-class voter who is struggling to get by is starting to turn away from the Tories and their leader's suggestion is to reduce taxes on the wealthiest people? Not to improve services or perhaps address the issues that drove former conservative party voters to Labour. No. Cutting the taxes of the elite, further reducing funding for services that the majority of voters use or rely on is the obvious answer.
Smash&Grab tactics with... do I smell a hint of Scorched Earth in the mix there?
Person 1: Smash n Grab with a side of Scorched Earth?
Person 2: Sounds like a recipe for destruction.
Person 1: but the heat would be so intense
Person 2: (Whispers) I'm a fire starter.
Person 1: (Laughs) I know.
The Tories are out of touch. Middle class only exists on paper anymore, and the Tories' answer is to cut taxes for the rich?
He wants to increase the threshold of where you start paying 40%. The title of this article makes it sound like it's 45% but it's not. Currently this threshold is at about £50k. So this would make the biggest difference to exactly the middle classes.
It's probably more to stave off a rebellion from Tory MPs and to keep donations flowing, not as an electoral strategy.
I am not from the UK do allow me a question: From what yearly income on, do you guys have to pay the „top tax“ and how high is it at the moment?
Interesting- compared to my country Germany where you have to pay 42% for everything you earn above (!) 62.810 €
Guess Germany hates its middle class even more than the UK…
In Ireland it’s about 48% on everything above €40k, then 52% above €70k.
That by itself could be misleading though, the overall effective tax rate for someone on €40k is 18%, around 30% at €70k. The thresholds will rise next year.
What is the break down of this? Is it the higher USC band? I'm not familiar with a 52% tax rate.
Yeah after about €70k there is a higher rate of USC. The 52% includes PAYE, PRSI and USC at the highest bands for a regular employee.
Per the article it’s not the top rate he plans to edit but the middle 40% rate which currently starts at £50,270. It’s a little more complex because there is also National Insurance to pay which drops when you hit the 40% tax rate so effectively you go from paying 32% total below £50,270 to 42% above £50,270 (for income above that level). There is a tax free band below £12,570 as well.
I’m simplifying because tax is complicated but roughly that’s how it works. As you move up tax bands you also lose amounts of other allowances like free dividend interest. Above £100k income it gets more complex because even more allowances are removed, especially the tax free band gets reduced.
Depends how you look at it. You lose £1 of PA for every £2 earned over £100k, which is an effective 50% tax rate.
Plus it adds the irritation of having to file a tax return even though you're on PAYE
You also lose £2k worth of tax free childcare instantly as soon as you earn £100k, a rare instance of it actually being possible to earn less money by getting a payrise
It's worth fiddling with your pension contributions to avoid that.
Also I'm not sure how the new childcare policy factors into it. I really need to look into it.