Thread by @DanielPriestley

Realistically who are “the rich” that we think should pay 45% income tax?

Let me start with who it’s not… it’s not the very wealthy. The Sunday Times has a “Rich List” and also a “High Tax Paying List” and guess what - no many names are on both lists.

So who are they?

The top 1% of tax payers will pay close to 30% of total income tax.

They are typically …
- Dentists /Doctors
- Senior IT workers
- Accountants / Lawyers
- Pilots / Engineers
- Executives / Senior Managers

These people sacrificed to gain valuable skills and most-likely have worked 50+ hours a week most of their career. They don’t have yachts, jets and stately homes. They trade their time (life) for income.

The people who earn serious money have companies, trusts and partnerships holding assets. Those assets are leveraged for yield or with debt. The income is offset against deductions. Many of the richest people “earn” £1 per year for a directorship. They can easily move offshore.

I say this just to be clear to anyone who thinks they are “sticking it to the rich” with this #autumnstatement2022 that you are mistaken. They are just saddling hard working, skilled people with more burden despite the fact they already pay almost a third of income tax.

An unintended consequence of this 45% tax rate will be highly skilled people refusing to work extra hours. If you were a Doctor and doing overtime was taxed at 45% would you accept the shift or stay home (and enjoy paying 20% VAT on what you spend)?