Comments on: Tax rates should fall as earnings rise http://dofonline.co.uk/blogs/the-edge/tax/tax-rates-should-fall-4112244/ Richard Northedge takes on corporate finance Wed, 23 May 2012 08:13:52 +0000 http://wordpress.org/?v=2.5.1 By: Chris K http://dofonline.co.uk/blogs/the-edge/tax/tax-rates-should-fall-4112244/#comment-8957 Chris K Wed, 22 Jul 2009 13:49:42 +0000 http://dofonline.co.uk/blogs/the-edge/?p=359#comment-8957 To suggest that people (and by this I mean real people who make up the bulk of UK tax income rather than an insignificant minority such as non-executive directors or dare I say it, Finance Directors) will turn down pay increases or overtime for tax reasons is laughable. Do you have any idea what thought the masses give to tax bands....? Somewhere approaching zero I can assure you. So let's just be clear that what you are really saying is that the top 2% or so of workers within the UK, who will make decisions based primarily on tax implications (such as yourself clearly), should pay less tax. Fine, but don't attempt to bury that slightly selfish idea under an imaginary "social conscience". One suggestion I might profer as to why your thinking is flawed is that earnings accelerate exponentially as you climb up the corporate ladder, a rate which is entirely disproportionate to the recipient's "value" which remains broadly unchanged. Executives with high wages and poor track records have reached plague proportions throughout the city. Accelerated pensions, golden hellos, goodbyes and parachutes, bonuses unrelated to actual performance. These are all devices used by the top tier to feed their greed. The increasing rates of tax can barely be said to offset their effects, let alone disincentivize them. (You will no doubt argue that the accelerated pensions etc are devices intended originally to offset the tax problem. This however still doesn't change the reality that "executives" are NOT significantly more able than the top 25% of the masses who they "lead") The negative effect of this unfair skewing of "value" are not simply economic, allowing people of dubious character and ability such as Fred continuing the hegemony of a "chosen" few at the expense of the many, many truly intelligent people in the UK who perhaps don't have such a money-making bent, or self aggrandising character. This in itself is a social injustice. As has ever been noted by those of an intelligence not purely devoted to personal gain..."Those most likely to find themselves in a position of power are usually the least suitable to hold it." Viz....http://www.physorg.com/news142607754.html In brief: I say that the 50% tax band is entirely suitable, as the law of diminishing returns most certainly applies to all humanity in relation to earnings. To suggest that people (and by this I mean real people who make up the bulk of UK tax income rather than an insignificant minority such as non-executive directors or dare I say it, Finance Directors) will turn down pay increases or overtime for tax reasons is laughable.
Do you have any idea what thought the masses give to tax bands….? Somewhere approaching zero I can assure you.
So let’s just be clear that what you are really saying is that the top 2% or so of workers within the UK, who will make decisions based primarily on tax implications (such as yourself clearly), should pay less tax. Fine, but don’t attempt to bury that slightly selfish idea under an imaginary “social conscience”.

One suggestion I might profer as to why your thinking is flawed is that earnings accelerate exponentially as you climb up the corporate ladder, a rate which is entirely disproportionate to the recipient’s “value” which remains broadly unchanged. Executives with high wages and poor track records have reached plague proportions throughout the city. Accelerated pensions, golden hellos, goodbyes and parachutes, bonuses unrelated to actual performance. These are all devices used by the top tier to feed their greed. The increasing rates of tax can barely be said to offset their effects, let alone disincentivize them. (You will no doubt argue that the accelerated pensions etc are devices intended originally to offset the tax problem. This however still doesn’t change the reality that “executives” are NOT significantly more able than the top 25% of the masses who they “lead”)
The negative effect of this unfair skewing of “value” are not simply economic, allowing people of dubious character and ability such as Fred continuing the hegemony of a “chosen” few at the expense of the many, many truly intelligent people in the UK who perhaps don’t have such a money-making bent, or self aggrandising character. This in itself is a social injustice. As has ever been noted by those of an intelligence not purely devoted to personal gain…”Those most likely to find themselves in a position of power are usually the least suitable to hold it.” Viz….http://www.physorg.com/news142607754.html

In brief: I say that the 50% tax band is entirely suitable, as the law of diminishing returns most certainly applies to all humanity in relation to earnings.

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