Tuesday, 16 August 2011

I don't pay enough taxes he said ...

... in today's "Times".
The world’s third-richest man is unhappy about the amount of tax he has to pay: he says it is not nearly enough.
That’s not all. Warren Buffett says that his wealthy friends do not pay enough either. Indeed, he says that his tax rate is barely half that of his secretary. Mr Buffett calculates that his effective rate last year was 17.4 per cent compared with 33 to 41 per cent for colleagues in his office. 
Well that will make us very happy Mr Buffett, unfortunately yours is a lone voice, and when he says ...

... that his own tax rate comes about because most of his income comes in the form “earned interest” — probably from capital gains and share dividends — which is taxed at a rate of 15 per cent, instead of the top marginal rate of federal income tax of 35 per cent that applies to Americans who earn $373,650 or more.
... he skips past the problem, the complexity of taxation, the complexity brought about by the powerful influences who have negotiated unfair advantages, lower tax rates and allowable expenses.  Unfortunately the retired local authority worker of Anglesey has not been able to negotiate such advantages whilst supporting the more affluent members of society in his or her daily toil..

There should only be a single rate of tax coupled with a single tax allowance, and a business should be compelled, at inception, to be created as a Limited Company or later morph into a Public Limited Company, that way our businesses become "people", the company will pay tax on its income at the rate that each member of the taxpaying public will.

It's true that income from business to the individual will have been paid twice, once by the company and then recipients of dividends, but that's not a problem as I consider a single tax rate of 20% across the board would work, and when you consider a tax rate of 40% has been the norm for the wealthier members of society there is little to shout about.

What about company investments, that's an expense if the investment is made in our country, whatever country you reside in, if it is an investment elsewhere, raise the money elsewhere and let the local population enjoy the benefits.

What about tax-havens, pointless as income is taxed at source, if you want a foreign bank account, then move on to that country.

What about those that cheat the system, we have prisons.

What about the businesses and financiers who play hard-ball with government, you know the tack ...
... if you don't do it our way, if you don't give us an advantage we will leave.

... there is always someone else to take up the strain, that's "Capitalism".

Why am I so convinced that taxation is so unfair, it is because an industry has grown up to gain advantages for the few, and to minimise a persons contribution to the tax pot, the proof of the pudding is in the eating.  It's very difficult to cheat when the game is simple ...

1 comment:

  1. ayn Rand on waleshome yesrerday thought that paying taxes wasa form of governemnt theft!