Not trying to single you out here, but I find the attitude towards wealthy people's income and assets, their property, quite disturbing. These headlines come Jo with such regularity and everyone believes that so many of our problems could be solved if we simply took a "fair share" from "the rich".
How about for a change there is a call for the general public to pay their fair share. In both Ireland and the UK almost 50% of income earners pay no income tax at all. But somehow it is fair to demand that rich people, who pay about 80% of all income taxes should hand over even more?!?!
then how come the latest report out shows the gap between rich and poor is widening all the time?
then how come the latest report out shows the gap between rich and poor is widening all the time?
The reason why wealthy people pay most of the overall income tax take is that they earn more. They are not asked to pay a higher rate of tax than someone on 50k. Someone on 500k is on the same effective tax rate (many times actually less) than someone on 50k. It is as pointless as saying that men pay most of income tax taken in every year. Everyone (including low earners) should pay their fair share of tax. However, we need to the look at the percentage of income paid, not the absolute amount. Is the person on €1m who pays €500k a better citizen than the person on €50k who pays €25k?
As for surveys showing the gap between the rich and the poor? Give me a break.
Someone on €500K will pay a much higher proportion of their income in tax than someone on €50k because the marginal rate accounts for a greater proportion of their tax bill. Someone on €50k pays way less than €25k, someone on €1 million (should) pay more than €500k.
Mmmm just a tad convenient to take the blinkered view of income tax only, no?The reason is that this thread is about Carr's taxes on income not on spending.
Mmmm, just a tad selective in the story there, no? No mention of overseas spending? No mention of overseas investment? No mention of %saved vs %spent? No mention of whether the neighbour's car is a company car or not, and all the tax implications that go with that? No mention of the %spent on customs and excise duties by the stereotypical smoking and drinking layabout, if some AAM posters are to be believed? But really, can't we move beyond the 'I know a bloke who buys a new car' stories?But of course VAT is also important, and I would still say that rich people pay way more VAT than the rest of the population. Their houses cost more, their cars cost more, they buy more expensive jewellery, their furniture costs more, all resulting in a higher VAT bill. Let me give you an example, I have a very wealthy neighbour who buys a new Merc every 2-3 years The last one he bought, a CLS 63, attracted over €40k in VAT and VRT, that would require an average person to spend €200k, and he did this on one purchase.
I don't think anyone questioned the legality of Carr's actions, but there is certainly an ethical and moral issue here. The issue arises from Carr's tendency to rush to judgement on others, for any and all kinds of reasons. If you're going to appoint yourself as judge and jury, you want to make sure you have a clean record. It's a bit like Bono lecturing the Irish government on how much aid they should be giving to Africa while avoiding Irish taxes by sheltering his income offshore. If he wants to avoid taxes, fine - but just shut up lecturing others.Anyway, back to Carr, I still believe that he did nothing wrong by reducing his tax bill, quite the opposite, he has kept money out of the wasteful hands of politicians. Unless Carr has invested all his money in Gilts he has done the economy a great service. I don't think there is anything unfair about it, he simply employed a better adviser than the rest did, who are now of course perfectly able to pursue the same process.
Actually, we need to look at the percentage of income paid on ALL taxes, not just income tax.However, we need to the look at the percentage of income paid, not the absolute amount.
Why - an inconvenient truth perhaps?As for surveys showing the gap between the rich and the poor? Give me a break.
And what are the particular flaws in the EU-SILC survey on which the Social Justice Ireland report was based?No, because the surveys are a load of crap. Same as the ones that show public sector employees earn more than the private sector. They are all deeply flawed.
I suspect that it will show that people on low incomes pay a much larger portion of their income on taxes than people on high incomes, when you take VAT and excise duties into account in particular.As for looking at all taxes, what will that show you?
I suspect that it will show that people on low incomes pay a much larger portion of their income on taxes than people on high incomes, when you take VAT and excise duties into account in particular.
Not at all, it is simply called sticking to the topic of the thread. But I would be very interested in a debate over VAT and other sources of tax, so maybe go ahead and start another thread.Mmmm just a tad convenient to take the blinkered view of income tax only, no?
Not selective at all. Do you think my rich neighbour is an exception when it comes to spending? But let's address some of the points you question:Mmmm, just a tad selective in the story there, no? No mention of overseas spending? No mention of overseas investment? No mention of %saved vs %spent? No mention of whether the neighbour's car is a company car or not, and all the tax implications that go with that? No mention of the %spent on customs and excise duties by the stereotypical smoking and drinking layabout, if some AAM posters are to be believed? But really, can't we move beyond the 'I know a bloke who buys a new car' stories?
I don't think anyone questioned the legality of Carr's actions, but there is certainly an ethical and moral issue here. The issue arises from Carr's tendency to rush to judgement on others, for any and all kinds of reasons. If you're going to appoint yourself as judge and jury, you want to make sure you have a clean record.
I fully agree, Bono is a total hypocrite.It's a bit like Bono lecturing the Irish government on how much aid they should be giving to Africa while avoiding Irish taxes by sheltering his income offshore. If he wants to avoid taxes, fine - but just shut up lecturing others.
He also wants American companies to pay tax in America (rather than here). In the context of this discussion I presume you support this. Will you also support the pay cuts for public servants and reduction in services to the public that would result if US companies pulled out of this tax haven?Obama's CGT move was to close a loophole exploited by many companies, who opted to return investment to shareholders via increased stock prices (attracting CGT) instead of dividends (attracting income tax).
In all fairness, Carr has built a large part of his reputation on taking the high moral ground. Look at his attack on 'tax avoiding bankers' here for context.
http://www.youtube.com/watch?v=WHwjRx2AG8M
Your analysis is still rather selective. You ignore the ability of wealthier people to spend more time overseas, to buy property overseas and to invest in overseas companies. Your analysis of proposed taxes in the UK ignore the option of an asset tax or wealth tax, which seems to work reasonably well in your beloved Switzerland, France and elsewhere.
Obama's CGT move was to close a loophole exploited by many companies, who opted to return investment to shareholders via increased stock prices (attracting CGT) instead of dividends (attracting income tax). As usual, those who were exploiting the loophole squeal a bit when they caught. I think we'll hear a bit more squealing over the coming years.
But nice that we could agree on Bono.
Given your location I suspect that many of the average joe's in your world have a pension and therefore have invested in equities, at home and abroad.Perhaps we live in different worlds Chris. 'Average Joe's in my world don't invest in equities, at home or abroad.
Complainer, your posts on this thread simply highlight the problem with people advocating higher taxes on rich people to solve the fiscal mess. You are constantly making assumptions and claims to desparately support your beliefs that either do not stand up to fact or are based on completely false premises.I'd be first to admit that I don't know much about wealth taxes, but you have made a convincing argument for rationalising these taxes across Europe and the developed world. There are good reasons why the Russian and Indian millionaires live in UK or the US etc. They prefer it to living in their home countries. There is indeed a tipping point that will push many of them away, but there is also room to get some kind of tax revenue here without reaching tipping point for most of these folk.
My analysis is not superficial at all but you are actually on to something in this statement. It is absolutely about the direction of movement in rates, and it is absolutely about people cashing in gains when taxes are down. You do realise that you are making my point here. When taxes go down less people try to legally avoid (e.g. by not selling gains) or illegally evade them. Another measured side effect when CGT was lowered was that more people invested, which is also a good thing.In relation to CGT, your analysis is very superficial. Your 'undeniable truth' does not show cause and effect. Look at what else was happening in the world. Was the increase in overall income due to the drop in rates or to market recoveries, or was it due to people taking the opportunity to cash in gains on the expectation that rates may well go back up again. Is it due to the movement in the rate rather than the absolute level of the rate.
Purple has already commented on your claim about average Joes not investing. Anyone with a PRSA has a selection of funds where the choices include Irish, European, Asian, US equities. I am surrounded by average Joes and 80% of them have a private pension, that is the real world, whether you like it or not.Perhaps we live in different worlds Chris. 'Average Joe's in my world don't invest in equities, at home or abroad.
I don't quite get your logic that because any wealth tax would not 'plug the hole', it is therefore not worth doing. I doubt if any individual tax will 'plug the hole', but that doesn't mean they are not worth doing. Every little helps, as they say.When it is pointed out that taxing even 100% of the income away from wealthy people is not enough to solve the problem you point to taxing their actual wealth. When it is pointed out that taxing their assets away is (a) not enough to plug the whole in public finances, and (b) would drive away those wealthy people you conclude that having a small wealth tax would not drive them away. But this again ignores the fact that even a small enough percentage of a tax taken on wealth will not plug the deficit!
And as I said earlier, the solution to this problem is for developing countries to come together and a common wealth tax, so these guys have nowhere to hide, or nowhere decent to hide, to be more specific. I'm sure you and others will continue to scaremonger to avoid any possibility of such taxes, but it's time to call some bluffs.You also claim that the likes of Laksmi Mittall , Usmanov and Abramovich live in the UK because they like living there compared to their home countries. This completely ignores the fact that they have non-domiciled status where only their UK based income is liable to UK income tax, not their foreign income and that they can use tax schemes like Carr does. These people could just as easily move to Monaco and pay 0% CGT, 0% wealth tax and 0% income tax; and there are plenty of other places where they can do the same.
The big problem with finding that tipping point for a wealth tax you allude to, is that once you find it, it is too late. But of course it is a lot more convenient to believe that you can take from rich people and (a) solve the budget problems and (b) not cause a reduction in revenue.
So the solution here is to avoid these reactionary drops in rates, so people stop playing the tax system and concentrate on investing. Let them cash in their gains when most appropriate for them, not based on temporary changes in tax rates.My analysis is not superficial at all but you are actually on to something in this statement. It is absolutely about the direction of movement in rates, and it is absolutely about people cashing in gains when taxes are down. You do realise that you are making my point here. When taxes go down less people try to legally avoid (e.g. by not selling gains) or illegally evade them. Another measured side effect when CGT was lowered was that more people invested, which is also a good thing.
I wasn't thinking about pensions when I made my point about average Joes, and I really don't think you were either. You are correct, in that lots of people with pensions are invested in equities. The proportion of these who make active investment decisions about where to invest is fairly low. Most people go along with whatever defaults the fund investment managers suggest. The substantive point remains - the more money you have, the easier it is for you to spend or invest it overseas, rather than in Ireland.Anyone with a PRSA has a selection of funds where the choices include Irish, European, Asian, US equities. I am surrounded by average Joes and 80% of them have a private pension, that is the real world, whether you like it or not.