Austerity conservatives have blown it in Britain. They raised the top income tax rate to 50% only to experience declining revenues from that bracket:
The Treasury received £10.35 billion in income tax payments from those paying by self-assessment last month, a drop of £509 million compared with January 2011. Most other taxes produced higher revenues over the same period.
Senior sources said that the first official figures indicated that there had been “manoeuvring” by well-off Britons to avoid the new higher rate. The figures will add to pressure on the Coalition to drop the levy amid fears it is forcing entrepreneurs to relocate abroad.
Please share widely!
johnk says
Glad we are not doing that and instead moving around 2 or 3 %, moving it back to when our ecomony was growing. You know, pre-Bush.
Mark L. Bail says
couldn’t be down because the UK’s recession has been longer than the Great Depression! Here’s Brad Delong (I’ll give you a break from Krugman):
Seascraper, you only have half of austerity here. The bigger problem is government cuts (can’t find any sources to support my opinion or yours). There’s a whole lot of money not being pumped into the economy. Taxes may be being diverted, but there’s no evidence here except unnamed sources who might–just might–have political reasons for tying decreased revenue to a tax increase.
Mark L. Bail says
who sends us to Bloomberg, which reports that unemployment rose and the economy isn’t just stagnant, but contracting.
And here’s a graph showing the 1930s and now.
seascraper says
I’m perfectly willing to concede that by raising tax rates, the British government so hobbled and hurt its own economy that it contracted and tax revenues fell.
Mark L. Bail says
something you take on faith.
mannygoldstein says
the top marginal tax rate was 91% under that commie Eisenhower, and the wealthiest Americans paid a total of 50% of income to federal taxes. (Well, actually the economy was *booming* during that sad time, but like I wrote, you can *imagine* how bad it was.)
Or take the Germany, with its confiscatory nanny-state predation upon the Job Creators. Capital gains taxed at 30% and a top marginal tax rate of more than 50%! Those poor bastards are the world’s second-biggest net exporters (after China, a country 18 times larger) and a family can live a middle-class existence on a single median income. Suckers!
Evidence is the last refuge of a Liberal!
seascraper says
Half the world was blown up and the Eastern bloc had a 100% tax rate. Different world now.
Germany’s corporate income tax is 15%. Are you advocating a reduction of the tax rate on business income?
mannygoldstein says
Because, in concert, they work well. Liberals are in favor of things that have been proven to work, you know.
As to the world half blown up, and Eastern bloc taxes – so what?
Mark L. Bail says
sound bites and red(state) herrings, Scrapie. Sometimes it’s hard to tell whether you guys don’t know what you’re talking about or don’t care. I think you care, but the Right Wing pees in its own intellectual pool so much you have a hard time seeing the bottom.
The Eastern bloc had a 100% tax rate? Do tell. How did that work? People worked, but received no money at all? Why did they print the ruble? but they had no economy or growth either.
The correct answer to taxes on corporate tax income is that many big corporations pay an effective tax rate lower than 15%. It depends on the company and the sector, but that’s the case. As tax attorney Linda M. Beale writes:
And Bruce Bartlett, the reality-based Reagan White House economic adviser, says our statutory tax rate of 35% is GOP BS: