{"id":14704,"date":"2012-03-21T08:09:02","date_gmt":"2012-03-21T08:09:02","guid":{"rendered":"http:\/\/www.taxresearch.org.uk\/Blog\/?p=14704"},"modified":"2012-03-21T08:09:02","modified_gmt":"2012-03-21T08:09:02","slug":"removing-higher-rate-tax-reliefs-for-those-earning-over-150000-is-not-a-tycoon-tax","status":"publish","type":"post","link":"https:\/\/www.taxresearch.org.uk\/Blog\/2012\/03\/21\/removing-higher-rate-tax-reliefs-for-those-earning-over-150000-is-not-a-tycoon-tax\/","title":{"rendered":"Removing higher rate tax reliefs for those earning over \u00c2\u00a3150,000 is not a tycoon tax"},"content":{"rendered":"

As the Guardian notes in its budget\u00a0speculation\u00a0this morning<\/a>:<\/p>\n

Soaking the rich?<\/strong>\u00a0Osborne's expected to announce a new tax raid on the wealthy, perhaps by limiting how much they can claim in tax reliefs: recent research for the TUC suggested that people who pay the 50p rate - ie those who earn over \u00a3150,000 - are able to claim on average \u00a315,000 a year in tax relief, on their pensions, charitable contributions and so on.<\/p>\n

This may be badged as a \"tycoon tax\", though some LibDems have already questioned whether it will be strong enough to merit the term.<\/p><\/blockquote>\n

Well, I didn't know that I was writing the tycoon tax when preparing that analysis for the TUC.<\/a><\/p>\n

And let's be clear: that's not a tycoon tax. A tycoon tax would have to ensure that the total tax of a\u00a0person\u00a0was taxed at a minimum\u00a0rate. This does not. It simply\u00a0increases, a bit, the effective tax rate on the part of their income that they declare in their own names. That ignores:<\/p>\n

1) The income the wealthy divert to others<\/p>\n

2) The income\u00a0the wealthy have in\u00a0personal\u00a0service companies<\/p>\n

3) What the wealthy hide offshore - now legally\u00a0permissible\u00a0thanks\u00a0to this\u00a0government\u00a0in Switzerland<\/a><\/p>\n

4) What they convert into gains<\/p>\n

5) The part that's hidden in trusts<\/p>\n

And so on.<\/p>\n

In which case this is a very, very long way from being a minimum tax rate, a tycoon tax or anything like such a thing.<\/p>\n

That's not to say I don't argue for restricting such allowances and\u00a0reliefs: at the very least I see no reason at all why tax\u00a0relief\u00a0should be given at higher rates and believe that this state subsidy to the savings and giving of the rich should be removed. But let's not sell it as something it's not, please.<\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

As the Guardian notes in its budget\u00a0speculation\u00a0this morning: Soaking the rich?\u00a0Osborne’s expected to announce a new tax raid on the wealthy, perhaps by limiting how
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