Surprise: UK’s Version of ‘Buffett Rule’ Failing to Bring in Expected Revenue
**Written by Doug Powers
In 2010, the UK implemented what could be described as their version of the “Buffett Rule” that President Obama has been proposing in the US.
Some background:
A new 50% tax rate for top earners has come into force at the start of the financial year.
The new rate will affect the 300,000 highest earners in the UK, out of the 29 million people who pay income tax [or the "upper one percent" - DP].
It will be levied on taxable incomes greater than £150,000 a year and aims to raise an extra £2.4bn by next year.
The 600,000 people who earn more than £100,000 a year will have their personal tax allowance eroded too, raising £1.5bn for the government.
Together with increased tax on pension contributions, which starts next year, the UK’s top 600,000 earners are expected to be paying an extra £7.5bn a year in tax.
[...]
The new 50% income tax rate is aimed at boosting public finances.
So how’s that going? Early numbers show that the concerns of those who thought the new tax would backfire like a TVR Cerbera were not unfounded:
The controversial 50p tax band is ‘not working’ and revenues have fallen since it was introduced, new figures suggest.
They appear to show the wealthy are finding ways to dodge the tax band levied on incomes of more than £150,000.
In January, the tax take from those who do self-assessment tax returns collapsed by more than £500million, compared with the same month in 2011. They fell from £10.86billion to £10.35billion.
The figures have been eagerly awaited by George Osborne as they provide the first evidence of the usefulness of the tax rate.
This is because January 31 was the deadline for all self-assessment forms to be filed for 2010-2011, the first full tax year since it was introduced.
The Centre for Economics and Business Reseach said it provided evidence that the 50p tax rate may be starting to hit receipts.
The figures will add to pressure on the Coalition to drop the levy amid fears it is forcing entrepreneurs to relocate abroad.
Separate figures, also published yesterday, provided more evidence that wealthy people are taking steps to avoid paying the tax.
So the well-to-do might be simply taking their money elsewhere? What a shocker!
The Obama administration actually recognizes this. So when pondering things like the “Buffett Rule,” instead of concluding that it might be a bad idea because of the inherent counterproductivity, they’re trying to figure out ways to do make those tax chains inescapable to even the most limber of capitalist Houdinis. That explains calls for things like a global minimum tax — a mandatory “we will find you and tax you anyway no matter where you are” penalty for any greedy, unpatriotic rich person who dares try to take their money elsewhere.
Turning America’s into a Hotel California of sorts (“you can check out any time you like, but you can never leave”) is a sure way to send any business that might have been even considering a move to America crawling back to their digs in other parts of the world — except maybe the UK, which is making a mistake the current US administration should heed but instead seems hell bent to duplicate.
**Written by Doug Powers
Twitter @ThePowersThatBe
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Every time NY or NJ raise their income taxes Florida’s population increases.
If they keep taxing them like that, none of them will have enough money left over to get their teeth fixed!
Ooh, that was a bit over!
There are two articles on Drudge on this issue. The first is bho’s plan to tax dividends and the other is on 49.5% of American’s who don’t pay taxes. bho and team wants us to be a third world country with all they are up to!
http://online.wsj.com/article/SB10001424052970204880404577225493025537660.html?mod=WSJ_hp_LEFTTopStories
http://blog.heritage.org/2012/02/19/chart-of-the-week-nearly-half-of-all-americans-dont-pay-income-taxes/
L
slags, twats and wankers. The lot.
Raising taxes on the wealthy is a sure way to reduce revenue. The mega rich always have the means to protect their income stream from the overreaching hands of the tax imposing government.
Now, if the leftist/statists had the nerve to actually tax wealth. Lessee, how much would an annual percentage, say 20%, of the value of Warren Buffet’s total assets bring in to the tax coffers?
Yep, that’s been the plan from the very start. Obummer & associates have always believed that the US is the problem and must be brought to her knees.
And the Sock Puppet capers and jerks:
“Mr. Obama is proposing to raise the dividend tax rate to the higher personal income tax rate of 39.6% that will kick in next year. Add in the planned phase-out of deductions and exemptions, and the rate hits 41%. Then add the 3.8% investment tax surcharge in ObamaCare, and the new dividend tax rate in 2013 would be 44.8%—nearly three times today’s 15% rate.”
And the libtard leftoid scumbags say Fearless Leader cares and loves the United States.
I keep coming back to a question that needs answering. Where are the “Patriots” in government? Either Party? Any branch?
I have a friend from Britain a Civil Engineer. His Father died and left his mother a home and money.
In Britain, at the time, this was 1996, the inheritance tax was 85%. His mother now lives in a small apartment and my Brit friend lives and works outside the UK.
The Brit gov. is driving the income earners out of Britain.
You mean Buffett and his limousine libbies might be LYING? Whoda thunk!
Doug, I’m as shocked as you are! People with choices make the right choice for themselves? This must be stopped! Why doesn’t the government own all businesses yet – that Obama may be a Marxist, but he’s also a slacker.
Making room for the welfare class moving in.
Gone. Phil has explained the one-party system, but he gets attacked personally when he does.
Guess nobody remembers how millionaires fled Maryland a few years ago. Da’ MD gubmint created a millionaire’s tax bracket and suddenly 1/3 or 1000 of MD’s millionaires went missing from the tax rolls. Instead of being up the $100 million the pols were salivating over they ended up being down $100 million. Stupid. Stupid. Stupid.
Eventually the leftists run out of other people’s money, which is why the U.N. and its supporters are advocating a world tax so there’s nowhere to hide.
Except the rich will probably always manage to do so with much of their wealth as long as they have the proper connections.
Leftists in state government always expect taxpayers to remain static and take what’s coming, and never figure out that millionaires will nearly always flee excessive taxation.
Remember the Luxury Yacht tax years ago. Put most of the U.S. yacht builders out of business. Rich people went to Europe to buy and register their toys. They always find a way around a repressive government.
Yeah, applied to personal aircraft too, but only NEW yachts and planes. SO, to Europe and elsewhere to purchase preowned boats and planes.
Practically destroyed both industries catering to the wealthy.
You left out poofters and guttersnipes.
hawkeye54:
I know a VERY wealthy person. He renounced his U.S. citizenship and now is forced to spend more than 6 months of the year in the Cayman Islands. Doesn’t like it too much (he owns 3 properties here in the U.S.), but he likes giving more of his hard-earned money to this MFers even less. I’m afraid I’ll never see him again the way this is going.
Well now bho is at it again? bho and dear joe plan to by-pass congress to get what they want done. bho and team have no intentions of dealing with congress this year!
http://www.theblaze.com/stories/obama-brags-about-bypassing-congress-again-joe-and-i-are-going-to-act/
Also, bho and team have once again ignores house subpoena’s on solyndra. Bet NOT ONE SINGLE gutless wonder will do a friggen thing about it either?
http://campaign2012.washingtonexaminer.com/blogs/beltway-confidential/wh-ignores-house-subpoena-solyndra-documents/387886
L
Why do these clowns keep trying things that have ALWAYS failed? Do they ever take one minute’s time to read history?
“Giving” is far too polite a term for what the government expects from the taxpayer, especially wealthy ones.
Before long, anyone earning 25K or more will be considered”wealthy” for the highest tax bracket.
Condoms on a banana, having the teacher tie you up and take bondage pictures, having your lunch inspected for illegal fruits and vegetables instead of mystery meat – so much to do and so little time. (Unless of course you cannot work and cannot be fired at $100,000 plus per year, then plenty of time.)
When is Congress going to learn that you treat a thug like a thug?
Maybe too many wusses who realize they are dealing with a thug, but who fear for losing their prize perks in holding office if they stand up to him. Or finding a horse’s head in their bed, or succumbing to an unfortunate accident.
We need fearless leaders. We’ve got too many self-absorbed gutless wonders.
Flyoverman:
Are you serious? This imbeciles couldn’t care less about history. They have The Marxist Playbook, and that’s all they know, and all they care about. Always follow it to its stupid, destructive end, consequences be damned!
hawkeye54:
How abou being afraid of being called “RRRRRAAAAAAAAAAAAAAAAACCCIIIIIISSSSTTTT!” Or simply having no balls?
Question:
Answer: Look up Einstein and Insanity.
So, how many people are moving to Monaco (which has no income tax, and nice weather) ?
Economics should be a required subject beginning in grade school.
This has played happened before. For example, Marc Bolan of T-Rex fled to California to escape high taxes in the 1970′s,
Yeah, that’s the case too.
Doesn’t help to have the MSM, and other organizations, on its knees behind Dear Leader, ready to do whatever it takes to destroy his opposition.
Hmm, I could do that. If I had a couple extra zeroes behind the totals of my savings and investments.
As it is I probably could afford Ecuador.
Oh heck, no I just throw stuff out there for no reason…………
hawkeye54:
At least I know I can afford the Dominican Republic. As long as you pay off the right people, they’ll leave you alone (as long as you don’t become too obvious or ostentatious.) Be as invisible as possible there, and you’re OK.
Flyoverman:
I was being sarcastic. You should know me well enough by now.
Another gem from A. Einstein: “The difference between intelligence and stupidity is that there are LIMITS to intelligence.”
Beam me up, Scotty, there’s no intelligent life here in D.C.
Like I said over at Hot Air, Andrew Mellon understood markets, capital and tax policy during the Coolidge administration. As treasurer he pushed to have the top tax rates dropped and the rich took their money out of shelters and invested it, creating jobs and wealth and… increasing revenue to the government.
Not only do the Progs ignore the failures of socialism, they ignore the success of free market capitalism. They don’t care about increasing revenue as much as they care about “fairness”.
Reaganomics confirmed once again.
The thing that makes me laugh the most is that the left keeps bringing up Buffett and saying he is an example of why they need the new tax rule. The thing they forget is that Buffett is already doing exactly what this story mentions…finding loopholes in the tax code. Buffett pays himself a very small salary to avoid the income tax and pays taxes on his capital gains instead (which is a lower rate).
If they really want more tax money coming into DC then lower the tax rates and reduce the out of control regulations that have businesses spooked. This will spur economic growth which in turn will lead to jobs being created, which in turn will lead to more people paying taxes.
Wait a minute fly… maybe global slavery just hasn’t been implemented by the right people yet – /sarc
Hmmm. (Makes mental note of sage advice.
)
By the way, there is no such thing as a “penny wise, pound foolish” dem in government.
When it comes to handling taxpayer revenues, and public funds in general, they are completely foolish no matter the monetary denomination. Wisdom never ever enters the picture.
I’ve long thought that a course in economics should be a job requirement for our legislators (with special emphasis on the Laffer curve). But alas, so many of our problems are caused by willful ignorance or outright malevolence on the part of our “leaders” that I’m not sure that it would do any good.
Both play significant roles on the part of our “leadership”
Depends on the teacher/professor and what part of economics would be actually taught and not editorialized.
No is no greed like a politican’s greed, especially when it’s a Democrat buying votes with your money.
The welfare class in the Britain are well and truly entrenched, benefits are so generous immigrants/migrants from four corners of the world flock here, the EU forbids the UK from withholding benefits to foreigners, even though they haven’t paid a penny into the system, they can claim jobseekers allowance, housing benfit, and every benefit going, use the NHS, classrooms are full of non-English speaking children, doctors surgeries full to the brim with foreigners, many are getting more on benefits than those on the average wage of £26,000, though how they work out the average wage baffles me. Meanwhile pensioners are dying of hypothermia because they can’t afford to heat & eat, they exist on £125 per week, kids are being denied proper education because foreign kids need more attention, and there’s been over 20,000 under 11′s put on a list as being racist, one 7 year old for asking if a boy was black because he came from Africa, put on a racist blacklist, it’s evil, truly evil.
Half of Britian is beholden to the state, either for benefits or working for the public sector. The voter, client base of the socialists.
The private sector is being raped finacially to pay for it, along with paying for the pernicious EU, the greenshirt lunacy, foreign aid lunacy and every other pet project that doesn’t benefit the British, that drains money from the taxpayers pocket.
An economist worked it that over half of workers pay packets goes to the government with direct taxes, indirect taxes like VAT and green taxes and other stealth taxes. We are being taxed to oblivion.
Tony Blair, so beloved in the USA should be tried for treason, along with the despicable, tratitorous, greedy, corrupt b******s we have now, socialists, dressed up as conservatives.
All democratic countries are seeing their nations brought down by a tiny minority to the majority why? And why can’t we stop it, why can’t we make the gullible, clients bases & downright stupid, understand they’re being used.
I hope and pray that they get the nukes out of Britanistan before the muzzies completely take over.
Anyone earning £43,000 in the UK is now taxed at 40%, and it won’t be long before they include those earning £40,000 into the higher tax bracket.
But Labour/conservative keep getting voted back in, although at the moment we have a coalition liberal dems/cons, and they’re as bad, if not worse than labour.
The taxpayer accepts all the high taxes without a murmur, oh they moan on blogs and MSM comments sections, then go out and vote for the rotten to the core politicans/parties they’re complaining about.
Not only does the taxpayer accept the high taxes, they also accept the importation of foreign criminals, terrorists, rapists, paedophiles, and none are deported, the European Court of Justice (injustice) a couple of weeks ago ruled we cannot deport a known murderer/terrorist to Jordan, who is extremely dangerous to our national security, because he might be tortured. He has been in prison here for 6 years as he is so dangerous, yet a British judge ruled he had to be released, and we’re paying benefits to him and his family. What about this, a court ruled that a violent rapist couldn’t be deported under some article of the human rights act, his right to a family life, he isn’t married, engaged etc., but would have to leave his cat, so the judge let him stay. It’s unbelieveable but true.
This country is a cesspit, I only wish I had the money to get out.
Anyone complaining about them are deemed racist, they’re a protected species in Britainistan, after them gays. Christianity is being airbrushed, many have been prosecuted for offending muslims or gays.
It’s like a race with the political elites who will be favoured most, gays or muslims, the way things are going muslims will come out on top, the elites are frightened of them, in a couple of decades it wouldn’t surprise me if they’ll be ruling the roost and the first for the chop will be gays, followed by non-muslims, whites first. But the militant gays, who are the driving force, NEVER speak out about muslim homophobia, they only bring prosecutions against christian people. And the Archbishop of Canterbury, CE, spoke out in favour of sharia law not that long ago, what chance have christians when the head of the church favours Islam.
We’re stuffed here, good and proper, but the only ones to blame are the electorate, they allow it to happen. It’s said you get the government you deserve, and that’s very true, sadly those of us that don’t deserve it suffer the consequences.
The destruction of Britain, the unlimited mass immigration/migration was been a deliberate policy by Tony Blair & now David Cameron, I know almost everyone hates the English, but our own politicans, why?
I hate then with a passion.
What? You mean there are other places willing to associate with those dirty one percenters and welcome them and their filthy money into their countries? Inconceivable!
It’s OK if it causes revenues to drop, because now the tax system is more “fair”.
Just ask Obama.
Wait, you mean people will naturally look out for their own self interests and avoid paying as much as possible? Who would have thunk it?
The only problem with those people is that many of them aren’t intelligent enough to understand that they are the problem, whether they live in NY/NJ or if they live in Florida.
Wow – thanks for the look at the UK. Sadly, Obama is trying to do the same here.
I think San Francisco has the same ordinance….
tramper; are you currently employed or are you a pensioner? Do you live in a large metropolis (London, Birmingham, etc)?
Not a pensioner, few years to go yet lol. No I’m not employed, got made redundant some time ago, but my husband works, like many others, very hard, a long distance lorry driver, although he, along with other drivers, have lost up to a £100 a week in pay because of EU rules, which the government enforce to the letter, even though LD were already very well regulated. EU diktats say you can only work 48 hrs a week, no overtime, but can work 60 hours a week for a number of weeks than have to take 2 weeks off without pay to even it out, it’s bureaucracy for it’s own sake, because they can. Not only does it apply to LD but doctors, nurses, who are complaining about it, they say it’s dangerous to patients when they have to stop work and hand over. EU rules mean they also have to employ foreign doctors/nurses even though they don’t speak English, some people have died because of this. The EU has succeeded in making the UK to an almost 3rd world country, deliberately, along with their willing collaborators, politicans and bureaucrats.
I live in London, which is now overrun with foreigners from every part of the world, Londonistan, is quite fitting, although there are many Eastern Europeans, and all the jobs are going to them, EU rules state British workers shouldn’t be given preference. The young have been chucked on the scrap heap. You can walk down the road for 30 minutes and not hear English spoke.
In short it’s a p***hole, and why Americans tourists want to come here and spend their hard earned baffles me.
I keep hoping the English will wake up and make use of the numerous lamp posts in Westminster. But I dream, the courage of the English belongs to those on the battlefields of WW2.
it sounds very much like the ‘new’ South Africa. Uneducated native people are given preference in many jobs because of, I’m assuming, historical apartheid shame. It is ruining the country. The economy is f*#ked.