The problems with the way the wealthy pay their taxes is still causing a rumpus in the News. Recent reports suggest that "some millionaires pay less tax than their secretaries" The question that should be answered is 'how do they do it?'
One method of paying less tax is to have your income paid into a company that you have set up, so that the income attracts 20% tax instead of the 45% that used to be 50%.
Donating to charity. Those with significant incomes could pay half of their income to charity and their tax rate is halved, or pay 75% of your income to charity and you will only pay 11% on the remainder. There have been reports that Lord Fink has told a group of wealthy individuals that the main reason to give to charity is because of all the interesting places you will get invited to, even No. 10. Anything that is done to harm wealthy people giving to charity will affect charities severely as 50% of charities income comes from just 8% of their donors. There was a suggestion for wealthy people's giving be treated the same as the majority that give to charity. When I give to charity, I usually 'tick the box' to say that I want the donation Gift-Aided. What happens then is the Treasurer of that organisation has to write my name and address on a form, along with others that have 'ticked the same box' and send it to H.M.R.C. These names and addresses are checked against the list of tax-payers in the U.K. Then H.M.R.C. send a cheque to that organisation for 25% of the donation. The main criticism is that this system creates a lot of work for little money, less than a wealthy person sending the appropriate forms to H.M.R.C. saying that they have given a large wedge of cash to a charity.
I think that I agree with another commentator, perhaps rather than George trying to 'iron out' the anomalies, one at a time, why not scrap the lot and start again? Then you could devise a tax system that could be fair and could be seen to be fair.
Will this lot do it? They may try, but they will screw it up!
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