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<blockquote data-quote="j&#039;nuh" data-source="post: 731460" data-attributes="member: 55446"><p>"Before taxes and benefits, the richest fifth of households had an average income of £78,300 in 2011/12, 14 times greater than the poorest fifth, who had an average income of £5,400.</p><p></p><p>Overall, taxes and benefits lead to income being shared more equally between households. After all taxes and benefits are taken into account, the ratio between the average incomes of the top and the bottom fifth of households (£57,300 per year and £15,800 respectively) is reduced to four-to-one."</p><p></p><p>(<a href="http://www.ons.gov.uk/ons/rel/household-income/the-effects-of-taxes-and-benefits-on-household-income/2011-2012/etb-stats-bulletin-2011-12.html" target="_blank">http://www.ons.gov.uk/ons/rel/household-income/the-effects-of-taxes-and-benefits-on-household-income/2011-2012/etb-stats-bulletin-2011-12.html</a>)</p><p></p><p>Clearly, the poorest benefit from having a state.</p><p></p><p>That said, on the topic of taxation, the idea that anyone pays 50% of their income in tax is really off the mark. </p><p></p><p>Let's start with income tax. For example, say someone is earning £200,000. In the UK, they would get £10,600 tax free. They would pay 20% on £10,601 to £31,785. They would then pay 40% on £31,786 to £150,000 and then 45% on anything over £150,000.</p><p></p><p>So 20% of (31,785 - 10,600) = 4,237</p><p>40% of (150,000 - 31,786) = 47,285.6</p><p>45% of (200,000 - 150,000) = 22,500</p><p></p><p>Total tax = 74,022.6 (37% of income, despite a top tax rate of 45%)</p><p></p><p>Second, consider earnings from investments. The amount of tax people pay on income from investments is tiny compared to what they would through PAYE. See: <a href="http://www.thesimpledollar.com/how-do-the-rich-pay-lower-taxes-and-how-can-you-do-it/" target="_blank">http://www.thesimpledollar.com/how-do-the-rich-pay-lower-taxes-and-how-can-you-do-it/</a></p><p></p><p>Third, the affects of indirect taxation. The poorest pay heaps more on indirect taxation (such as VAT and Council Tax) than the richest. This really balances out the amount of taxation that the poorest pay compared to the richest. See: <a href="http://www.independent.co.uk/news/uk/politics/the-graph-that-shows-how-the-poor-are-paying-more-than-the-rich-in-tax-10353982.html" target="_blank">http://www.independent.co.uk/news/uk/politics/the-graph-that-shows-how-the-poor-are-paying-more-than-the-rich-in-tax-10353982.html</a></p><p></p><p>Taxation is a mess in the Western world, because the state is held hostage by the richest. They use their political and media clout the peddle the lie that they pay too much in tax in order to reduce their own tax burden. Income tax comes down, whilst truly regressive taxes such as Council Tax and VAT remain the same.</p></blockquote><p></p>
[QUOTE="j'nuh, post: 731460, member: 55446"] "Before taxes and benefits, the richest fifth of households had an average income of £78,300 in 2011/12, 14 times greater than the poorest fifth, who had an average income of £5,400. Overall, taxes and benefits lead to income being shared more equally between households. After all taxes and benefits are taken into account, the ratio between the average incomes of the top and the bottom fifth of households (£57,300 per year and £15,800 respectively) is reduced to four-to-one." ([URL]http://www.ons.gov.uk/ons/rel/household-income/the-effects-of-taxes-and-benefits-on-household-income/2011-2012/etb-stats-bulletin-2011-12.html[/URL]) Clearly, the poorest benefit from having a state. That said, on the topic of taxation, the idea that anyone pays 50% of their income in tax is really off the mark. Let's start with income tax. For example, say someone is earning £200,000. In the UK, they would get £10,600 tax free. They would pay 20% on £10,601 to £31,785. They would then pay 40% on £31,786 to £150,000 and then 45% on anything over £150,000. So 20% of (31,785 - 10,600) = 4,237 40% of (150,000 - 31,786) = 47,285.6 45% of (200,000 - 150,000) = 22,500 Total tax = 74,022.6 (37% of income, despite a top tax rate of 45%) Second, consider earnings from investments. The amount of tax people pay on income from investments is tiny compared to what they would through PAYE. See: [URL]http://www.thesimpledollar.com/how-do-the-rich-pay-lower-taxes-and-how-can-you-do-it/[/URL] Third, the affects of indirect taxation. The poorest pay heaps more on indirect taxation (such as VAT and Council Tax) than the richest. This really balances out the amount of taxation that the poorest pay compared to the richest. See: [URL]http://www.independent.co.uk/news/uk/politics/the-graph-that-shows-how-the-poor-are-paying-more-than-the-rich-in-tax-10353982.html[/URL] Taxation is a mess in the Western world, because the state is held hostage by the richest. They use their political and media clout the peddle the lie that they pay too much in tax in order to reduce their own tax burden. Income tax comes down, whilst truly regressive taxes such as Council Tax and VAT remain the same. [/QUOTE]
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