Taxing the rich?

The government has indicated it wants to cut income and wealth taxes. Doubtless the cry will go up from Labour that this will be tax cuts for the rich. In trust in practice it will be tax cuts for all. Today I want to seek your advice on who are the rich that Labour wants to tax.

Let’s begin with a group of millionaires. Many would say automatically all millionaires are rich, because by definition they have a million pounds of assets which no poor person enjoys. Here are some interesting millionaires:

Mr A is an elderly pension living on his own in a modest one bedroom flat in central London. He bought this many years ago, and it is now said to be worth £1m even though it is not in a good state. He has no other savings and lives on the state retirement pension and top up benefits. He cannot afford a car or holidays. He does not want to move as his friends and support group live nearby.

Mr B is another elderly pensioner who lives in a modern flat in a market town, worth £250,000. He has an investment fund worth £750,000. With his adviser he plans to draw down around £50,000 every year to spend, and reckons with the anticipated returns his fund might last him 20 years. He will adjust his drawing up if the investments do better, and down if they do worse. He also has his state pension.

Mrs C recently sold her £750,000 family home on the death of her husband. She also has £250,000 of other savings. She has bought a £250,000 new smaller home. She has given £250,000 to each of her two children to help them with housing and private education costs for her grandchildren. She has bought an annuity with the other £250,000 to provide her with an income of £10,000 a year to add to the state pension.

Mrs D and her new partner have just sold her £1m house and have decided to rent. They also plan to spend their way through the £1m whilst they are still in good enough health to enjoy the cruises, expensive hotel stays, grand events and good restaurants they have always wanted to try. They expect to spend at least £100,000 a year. They take the view that no-one knows how long they will live and you cant take the money with you.They say you can always rely on the state if you live for a long time.

Are all 4 of these people rich? If not, which if any of them are rich?
Mrs C is no longer a millionaire because she chose to give money away. Mr A is very income poor and depends on state top ups for his income. Mr B is on a well above average income, but will be depleting his capital, taking it down to very little over the balance of his lifetime. Mrs D will spend like a rich person but will run out of cash quite quickly as she does.

Do we tax them fairly? Those that spend away their capital will pay more VAT but less income tax and capital gains. Those who keep their savings will pay more income tax and capital gains tax. Those who move will pay more Stamp Duty. Those who run down their capital will not only pay less income tax but will receive more state benefits if they live long enough. Those giving money away before their death will be trying to find ways to avoid Inheritance Tax.

Observant readers will realise that all these people have the same options as each other because they all start with £1m of assets.

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  1. Mark B
    Posted August 24, 2019 at 5:12 am | Permalink

    Good morning

    Define both rich and poor ?

    I ask the above as both are relative terms. Someone here living on benefits is wealthier than someone else living in a slum in India.

    What irritates me are taxes on insurance an domestic fuel bills. This is just naked theft.

    • Lifelogic
      Posted August 24, 2019 at 7:37 am | Permalink

      My advice in general is not to insure at all. Unless you have to by law or perhaps just your house (but even then take a big excess. If you insure you are paying the 12% IPT, the profits of the insurance company, sales costs and overheads of the insurance company plus money to all those who make fraudulent claims. Plus you have the hassle and irritation of making claims. Just keep the premiums & self insure. Cut out the middle men and the tax man.

      Only insure if you think you are a rather higher risk than the average person and can still get an average premium. Or if it might be some risk you could not cover such as a big injury/liability claim or a house burning down.

      • Lynn Atkinson
        Posted August 24, 2019 at 5:03 pm | Permalink

        Brilliant advice and one I have followed all my life. I also don’t have a pension but put the ‘pension’ money into other investments over which I have total control. My retirement income is fully funded and no idiot children in the city use my money to gamble! I do a lot better than their 4% return which is the subsidy they get from Government.

        • Martin in Cardiff
          Posted August 24, 2019 at 7:11 pm | Permalink

          No, those examples are not of truly rich people.

          For that reason no government, Labour or any other, would likely try to tax their “wealth”.

          • Edward2
            Posted August 24, 2019 at 10:55 pm | Permalink

            Well that’s not right Martin
            Labour want a wealth tax on those with above average value of assets and higher tax rates for higher earners.
            Look it up.

          • Martin in Cardiff
            Posted August 25, 2019 at 6:38 am | Permalink

            No, not on those with merely “above average” assets, but those with exceptional wealth, perhaps, Edwards.

            Most civilised countries have progressive taxation. I did not object to paying tax at the higher rate. And I had family to support.

            And your problem is?

          • Edward2
            Posted August 25, 2019 at 7:41 am | Permalink

            My problem Marin is that you first boldly said “no government, Labour or any other, would likely try to tax their wealth”
            Labour has published policy proposals for a wealth tax and wants even higher top rates on income tax and higher rates of capital gains tax and higher corporation tax rates.
            This is plainly an attack on above average earners.
            So you were completely wrong.
            And for a lefty Labour fan this is rather poor level of understanding what you are voting for.

    • cynic
      Posted August 24, 2019 at 1:26 pm | Permalink

      Socialist definition of rich – anyone better off than me.

  2. formula57
    Posted August 24, 2019 at 5:22 am | Permalink

    Surely Labour will want to clobber all of them for as much tax as it can, given its ideology that money is better spent by the State than the individual, that anyone with more than the have-nots is fair game, and self-reliance and aspiration are dangerous conditions.

    (Is Mrs. D happy with her new partner? If not, I perhaps could be persuaded….)

    • George Dunnett
      Posted August 24, 2019 at 7:22 am | Permalink

      Brilliant!!! LOL

      • Fedupsoutherner
        Posted August 24, 2019 at 7:52 am | Permalink


    • Matt Ryan
      Posted August 24, 2019 at 12:18 pm | Permalink

      +1 – All socialist parties will tax them all until it hurts. Some might even confiscate private property to do so. Sadly the party that calls themselves Conservative are no better.

    • mickc
      Posted August 24, 2019 at 8:05 pm | Permalink

      Regrettably it’s not just Labour…the Tories also believe our money is better spent by the state….

  3. Lifelogic
    Posted August 24, 2019 at 5:45 am | Permalink

    We tax the rich best by encouraging them to pay for their children’s and grand children’s education themselves rather than getting the state to do so. Also by encouraging them to pay for their own health care. In countries that charge for the GP (say £50 a visit) you can nearly always see a GP the same day and a GP who specialises in the right area needed. For about £100 they will visit you. Also by encouraging them to provide for their own old age. In the UK the private vet service is far more efficient than the rationed 16 day delayed GP service.

    We also get far more tax if we have a larger gdp and do not push the wealthy and investment overseas.

    So what has Gordon Brown followed by the appalling Osborne & Hammond done. The attacked private pensions, reduced the pension pot sizes and contribution limits, attacked nondoms, frozen the IHT theshold at £325K, attacked landlords and tenants, incleased taxes on insurance to 12%, failed to give any tax breaks for companies or people making their own medical provisions, increased vat to 20% and stamp duty up to 15%. All totally insane.

    Someone who comes to the UK and invests their money in the UK can easily find that the government takes 80%+ of it off them after say 25 years. £1 million sensibly invested with no tax might grown to circa £5 million in real terms over this period. In the UK with 45% income tax, 15% stamp duty, 20% vat, 12% IPT, council tax, business rates, cororation tax, car taxes, CGT tax at up to 28%, IHT 40% on death and all the rest …… then you are lucky if the your relatives are left with just the £1 million after your death in real terms.

    Who needs wealth taxes they grab 80% anyway! The reason this is so damaging is :-

    1. Individual and businesses invest money so much better and more efficiently than governments do.
    2. The daft, high and absurdly complex tax rules generate lots of non porductive activity in tax collection, tax planning and similar.
    3. They deter £ many billions of sensible investments.
    4. They distract management from productive activities to other more parasitic and unproductive ones.
    5. The tax rules make people do things that would be irrational and damaging but for the daft tax rules. Ending up with over complex corporate stuctures that are costly to run.
    6. They push hard working and rich people abroad.
    7. In augment and encourages the feckless to live off the backs of others.

    All this is before the idiotic employment laws and mad expensive energy policies which does even more huge damage on top.

    • Bob
      Posted August 24, 2019 at 11:42 am | Permalink

      For so many years the government have encouraged people to save money in pensions and then they whack them with a 55% tax retrospectively.

      No wonder people lost faith in pensions.

      • Lifelogic
        Posted August 25, 2019 at 7:49 am | Permalink

        Exactly. You invest on one basis and they keep moving the goal posts too rob you!

        • Bob
          Posted August 26, 2019 at 9:08 am | Permalink

          Indeed it is legalised theft.

    • Mary McDougall
      Posted August 24, 2019 at 12:07 pm | Permalink

      So pleasant to find someone with not only common sense but a good brain as well.

      • Lifelogic
        Posted August 25, 2019 at 7:52 am | Permalink

        Most kind.

        I have no axe to grind so I can freely say what I think is the truth which help.

    • mickc
      Posted August 24, 2019 at 8:07 pm | Permalink

      Yes….absolutely right!

  4. GilesB
    Posted August 24, 2019 at 5:46 am | Permalink

    In the same block of flats as Mr B lives Mr B+ a retired civil servant. He has a public sector pension currently worth £40,000 which is guaranteed by the state to last his lifetime and keep pace with inflation. An Independent Financial Adviser estimates the value of this public sector pension at more than £750,000.

    • Fred H
      Posted August 24, 2019 at 9:51 am | Permalink

      Mr B would have had to put in at least 40 years for max pension, and earned with rises (certainly NOT RPI for all the years, often zero) £80k pa to enable £40k pension.
      So think back – a salary of say £20k rising over years to £80k would have meant high income tax/Nat Ins. He also would have contributed a basic pension deduction. A top earner in any industry paying in say 8% + employer 8% would not be much different. Your point is?

      • Matt Ryan
        Posted August 24, 2019 at 12:22 pm | Permalink

        Mr B+ would not have personally put anything into his pension (or at least, not until recently). The point is that the public sector complain about wages not matching the private sector but they handily ignored the value of the pension they were given. Once they had the (Labour) government match their pay, they were significantly better off than private sector.

        The estimate of the pension is incorrect also, a £40k index linked pension has probably reached the lifetime limit.

      • a-tracy
        Posted August 25, 2019 at 6:37 pm | Permalink

        Fred, we were advised to match a public sector type pension we would need to put up 30% over the lower earnings level with no guarantees that the defined benefit could be achieved. New tax rules put paid to catching up.

    • JoolsB
      Posted August 24, 2019 at 5:12 pm | Permalink

      Totally agree Giles B. It’s time public sector pensions were based on contributions /markets and not guaranteed by us mugs who can only dream of such pensions. And that includes MPs.

  5. Frances Truscott
    Posted August 24, 2019 at 5:47 am | Permalink

    And have any of the examples planned to pay for any care needs they may have? People need to be able to keep enough of their own money to pay for a care home and leave something to help their family.

    • Mike Wilson
      Posted August 24, 2019 at 11:07 am | Permalink

      No average person earns enough in their life to save for a pension and to afford a bloody ‘care’ home

      • Frances Truscott
        Posted August 25, 2019 at 5:43 am | Permalink

        By the time you have any kind of house and a decent pension pot yes you do have enough to pay for end of life care.

  6. GilesB
    Posted August 24, 2019 at 5:48 am | Permalink

    currently paying £40,000 each year

  7. Frances Truscott
    Posted August 24, 2019 at 5:49 am | Permalink

    Labour plans to rob the living and the dead.

  8. James1
    Posted August 24, 2019 at 5:58 am | Permalink

    “Do we tax them fairly?” The answer is that it is so difficult to tell that nobody really knows. Therein lies the nub of the problem. People cannot tell whether they are being taxed “fairly” because the tax system is so ridiculously complicated. It needs to be radically simplified along the lines of each person paying a fixed sum of their income phased down in stages to around 10% with all loopholes closed. At the same time the government and public sector needs to be massively downsized.

    • Lifelogic
      Posted August 24, 2019 at 10:57 am | Permalink

      Does Corbyn this it would being “fair” to nationalise rail and water (without paying the real value to the owners) or to rob assets off landlords (and gift them to sitting tenants) by restricting rents and preventing evictions, or to make people without degrees fund the degrees of those who do get them?

      It is nothing about being “fair” it is all about stealing money off one lot of people (who you think will not vote for you anyway) to try to buy the votes of others who might. That plus the evil politic of envy. If Corbyn and Mc Donnall think that it is fair (or would help the economy) to do these things they are even more idiotic than I already think they are.

  9. agricola
    Posted August 24, 2019 at 6:02 am | Permalink

    Let there be income tax and a spending tax (VAT), but no further tax such as IHT, Stamp Duty, Death Duty on wealth, and the theft of frugality when people need end of life care, that has already been taxed in it’s creation.

    The adjustment should be by government in what it spends and does. The first it does badly and the second it does too much of. Forget the socialist mantra of taxing the so called rich. At some stage in the creation of their wealth someone has been frugal. Those who have not should not expect the state (the frugal) to pick up the tab.

    Government should concentrate on defence, policing, NHS inclusive of end of life care, education, and infrastructure. Life is not equal, you cannot legislate or tax it to achieve equality. What government can offer is equality of opportunity. After that it is up to the individual. Excessive taxation causes people to cheat the system or to leave.

    • sm
      Posted August 24, 2019 at 8:05 am | Permalink

      Absolutely agree, Agricola. There are three reasons for the State (any kind of state) to tax people:

      1) to pay for services the public need/want.

      2) to slip ‘encouragement’ to supporters (pork-barrel politics).

      3) to punish the rich and anyone else not in the favour of the governing class of the moment.

    • A different Simon
      Posted August 24, 2019 at 9:16 am | Permalink

      Disagree ,

      Increase taxation of unearned income streams from natural monopolies , the largest being the economic rental value of residential and business locations .

      Offset this by reducing taxation on earned income and on profits on production ,(increase taxation on rent seeking activities like real estate speculation and money lending) .

      This would have the effect of levelling the playing field for British workers so they are not at a disadvantage to absentee landlords and foreign real estate speculators .

      This could be made taxation neutral for the majority of ordinary people and measures such as deferment put in place for asset rich income poor old people .

      It is essentially a question of whether the rental value of a location (which is mainly the result of God/Nature and spending by society as a whole) should be paid to society or the 0.01% via mortgage lenders .

      Adam Smith recommended this with his Annual Ground Rent (AGR) and Henry George and others with Land/Location Value tax (based on the rental value of a residential location as opposed to the development on it .

      This would not be so different from a return to the old Rates system but with location taxes being greater than income taxes .

      • agricola
        Posted August 25, 2019 at 5:54 am | Permalink

        So once your talent exceed thise of the majority of ordinary people you up sticks and move to a more tax friendly dnvironment. Ordinary do not reate wealth either as individuals or as a nation. Government should create the opportunity to be above average via education, but if you then wish as a nation to benefit be very careful how you apply tax or they will take their talents elsewhere.

        Socialism has never worked in any UK or international form outside a monastry or a Kibbutz. Even they I suspect have their pecking order.

    • Lifelogic
      Posted August 24, 2019 at 12:23 pm | Permalink

      “What government can offer is equality of opportunity”.

      No it cannot even do that. It cannot cure all diseases, make all parents good one, restore sight to the blind, make all schools equal, ensure we all live in nice safe places, make everyone equally bright ……. how can it?

      • agricola
        Posted August 25, 2019 at 12:43 pm | Permalink

        Yes it can and once did with large numbers of grammar schools and the direct grant system. That was equality of opportunity. It starts and finishes with education. After that you are on your own.

        It could be spread even wider with technical education in profusion for tose of little academic inclination. That is what I meant by equality of opportunity.

  10. Lifelogic
    Posted August 24, 2019 at 6:03 am | Permalink

    Do we tax them fairly?

    I do not think Hammond, Osborne or Gordon Brown cared a damn about taxing “fairly” they just wanted to grab as much tax as they could off them so that the government could largely piss it down the drain or use it on propaganda or pormises to try to buy votes.

    What is fare about up to 15% stamp duty for people who move when someone who stays put pays nothing? What is fair about an £80 parking fine because your child needed the loo and you are one minute late back to the car? What is fair (or sustainable) about taxing landlords (and thus tenants) on profit that they have not even made by double taxing their interest? What is fair about taking 40% of some (slightly rich) people on death when others with £10 million + can avoid this by expensive tax planning? What is fair or sensible about the pension tax than can deter doctors and others from extra working at all (as it taxes at over 100%?)

    What is fair (or fair competion) about having to pay the BBC TV tax in order to have lefty Guardian think propaganda rammed down everyone’s throats?

    What is fair about people who use private schools (and/or medical services) having to pay three or four times over? Once for other people’s children, once for the income tax on the money you need to earn to pay the fees, then the fees, then 12% IPT (on medical insurance) too.

    What is fair about some tax payers (often without degrees) having to fund largely worthless degrees in largely worthless subjects for other people’s children with soft and loan that are largely written off?

    “Fair” does not really come into it!

    • Lifelogic
      Posted August 24, 2019 at 6:12 am | Permalink

      What is fair about two people (on similar salaries) living in similar houses one taxpayer subsidised social housing costing £110 PW and the other next door £400 PW at market rent? Giving the first £15k PA more disposable income to spend but both paying the same tax?

      • Lifelogic
        Posted August 24, 2019 at 6:43 am | Permalink

        Or indeed two people earning the same living next door to each other but one has a £10K annual commuting bill (which is not tax deductible unless you are an MP perhaps) the other working across the road? The latter perhaps unable to move due to the absurd up to 15% stamp duty rates (or perhaps other family reasons).

    • Lifelogic
      Posted August 24, 2019 at 6:51 am | Permalink

      What is “fair” about members of the House of Lords getting a £305 daily allowance (tax free) or EU bureaucrats having special tax rates and tax free ‘expenses’ that have not even been incurred on top of their large salaries and pensions?

      • McBryde
        Posted August 24, 2019 at 8:49 am | Permalink

        Someone on benefits in a £1/2M house living next to someone with £30,000 savings (thereby not being eligible for state assistance), paying rent and unable to get on the housing ladder.

      • Matt Ryan
        Posted August 24, 2019 at 12:25 pm | Permalink

        And that £300 / day not even being checked so people claim without actually doing anything (in some cases not even appearing at Westminster Palace for 5 minutes)!

    • A different Simon
      Posted August 24, 2019 at 9:49 am | Permalink

      Quote Lifelogic “What is fair (or sustainable) about taxing landlords (and thus tenants) …. ”

      Landlord costs including taxation cannot be passed on to tenants when rents are already based on the maximum the borrower/tenant can afford (as is currently the case ) .

      Commercial property landlords are discovering they have to accept lower rents if they want to keep their high street retail locations occupied when most shops are struggling to break even .

      If there was an across the board tax cut of £100 pounds per month on earned income , landlords would quickly put rents up by £100 pounds per month and owner occupiers/new buyers would not escape because banks would increase interest rates and lend greater multiples .

      Thus the worker would not benefit from the cut of £100/month in income tax , the land lobby (incl. finance) would .

      • Lifelogic
        Posted August 24, 2019 at 10:59 am | Permalink

        Yes but if the landlord is losing money there will soon be nothing to rent.

  11. Lifelogic
    Posted August 24, 2019 at 6:07 am | Permalink

    Douglas Murray is good today as he usually is – in the Telegraph.

    The rage of the Remainers will be truly awesome if the EU gives Boris a deal
    Anti-Brexit campaigners have been praying for a disaster to befall Britain to prove that they were right.

    • Andy
      Posted August 24, 2019 at 8:31 am | Permalink

      Of course the EU with give Boris a deal. It will basically be the Withdrawal Agreement – but they may change a few paragraphs to make it look new. It will get a new name and a different font. But it will be essentially the same.

      Has this not been obvious to you? The WA is basically what Brexit means. Unless the Tory government changes its red lines it is basically is good as it gets. Might the EU give you a sweetener or two? Sure. Will the WA be worse than EU membership? Absolutely.

      • agricola
        Posted August 24, 2019 at 9:21 am | Permalink

        In the light of your last statement for once we agree. My conclusion is that a stake should be hammered through the heart of the WA and the EU be invited to it’s funeral.

        The EU can be offered a deal, FTA with continuity safeguards. If they refuse then they get a bare WTO result. Either way the absolute sovereignty of the UK is paramount. We survived very well with hiccups of our own making up to about the time we joined the EEC, we can do it in future. Think positive, who dares wins.

        • margaret howard
          Posted August 24, 2019 at 12:33 pm | Permalink


          “We survived very well……”

          So please tell us why we begged to join the EU in the first place?

          Furthermore the EU is a bloc of 28 sovereign countries with their own parliaments who decided decades ago to form a trading bloc which has become the most successful in the world. (And please don’t mention China or India – they were poverty stricken nations at the time)

          The other 27 members don’t have any difficulties with retaining their own sovereignty. Does that mean we ourselves are so uncertain about our own sovereignty, especially in the light of having recently had a prime minister foisted on us? Can’t imagine France, Germany, Denmark etc putting up with that.

          • Edward2
            Posted August 24, 2019 at 11:23 pm | Permalink

            Well that’s wrong margaret.
            We joined the Common Market
            Six similar trading nations.
            The EU superstate of 28 nations is post 1990 idea.
            Next comes the United States of Europe.

          • agricola
            Posted August 25, 2019 at 1:04 pm | Permalink

            Margaret, I suspect that Heath thought the whole EEC/EU attraction stemmed from his experience fighting in WW2. If he and his successors had stuck with a trading bloc they may have produced a USEU in years to come with the support of the majority of Europeans. As it is they have created an economically unbalanced bloc of resentment.

            The 28 component countries are barely sovereign. Ask Greece, Italy, and the unemployed of all the Mediterranean countries. It is this lack of sovereignty that has been the principal driver of our departure. Your last paragraph suggests to me that you have little concept of what sovereignty is. You opt for the humiliation of dependency as do remainers as a whole. Get yourself into the mindset of the self employed who brave the risk and lack of support for the eventual smell of success and the mental liberation that ensues.

        • Martin in Cardiff
          Posted August 24, 2019 at 7:08 pm | Permalink

          The UK is the supplicant party, not the European Union.

          • L Jones
            Posted August 24, 2019 at 11:42 pm | Permalink

            We’re not ”supplicant”. The UK is bending over backwards to be accommodating – unnecessarily. We don’t need a trade agreement in order to leave. There is a big and better world out there just waiting for us to be free of the shackles. The EU countries seem to be trading mostly with one another – we’d rather not be a part of that. Far too incestuous.

            We are not all flat-earthlings like many remainers.

          • Martin in Cardiff
            Posted August 25, 2019 at 9:46 am | Permalink

            Over eighty per cent of UK commerce is within its domestic market, LJ.

            Why should countries of the European Union be different?

      • steve
        Posted August 24, 2019 at 12:48 pm | Permalink


        “Of course the EU with give Boris a deal. It will basically be the Withdrawal Agreement – but they may change a few paragraphs to make it look new. It will get a new name and a different font. But it will be essentially the same.”

        Has already been agreed.

        Most of us gave Boris the chance, he’s blown it, now he and the entire conservative party will be subject of our revenge. We warned many times
        over what would happen if we were betrayed again.

        We’ll get these monkeys, every last one of them.

        • McBryde
          Posted August 24, 2019 at 9:40 pm | Permalink

          he’s blown it
          I thought it telling right from Boris’ being PM that Sir JR, with all his past experience in government and, in particular, in matters european, didn’t get into the cabinet.

        • Andy
          Posted August 24, 2019 at 10:00 pm | Permalink

          When you say ‘most of us’ have Boris a chance what you actually means is less than 100,000 mostly old white men gave Boris a chance out of an electorate of 45m.

          And you are already complaining that El Presidente – who has packed his Cabinet with some of the extremist (but dimmest) Brexiteers – is not Brexity enough for you.

          • agricola
            Posted August 25, 2019 at 1:15 pm | Permalink

            Winston Churchill arrived in a crises when the then government was standing with it’s collective knickers round it’s ankles. The May government was bereft of integrity or a route map, so up steps Boris elected with more support than WC. The only windgers are those Corbynistas who saw the door to power closing on them. So keep it up with as much irrelevance as you can muster.

      • tim
        Posted August 24, 2019 at 2:02 pm | Permalink

        totally agree, this crap is a smoke screen, to hide the Quisling Borris brexit betrayer.

    • steve
      Posted August 24, 2019 at 12:38 pm | Permalink


      “The rage of the Remainers will be truly awesome”

      …..Nothing compared to the fury of leavers.

  12. Mike Stallard
    Posted August 24, 2019 at 6:14 am | Permalink

    This touches only the tip of the problem.

    In the sight of God, everyone – even Her Majesty the Queen – is equal. Nobody disputes this (except atheists of course!)
    But equality is not the same as identical.

    By looking down on other people less fortunate, the Labour Party and its acolytes quickly turn into an elite who actually prevent other people joining them “at the top”.
    We need to encourage everyone to work towards their potential. And that is completely different. We ought to be pleased when people get rewarded for their life long efforts.

    Instead of condemning success, we ought to be celebrating it!

    • libertarian
      Posted August 24, 2019 at 10:30 am | Permalink

      Mike Stallard

      I think you’ll find us atheists think that all people are equal and everyone has equality of opportunity in a free country . It just depends how much effort you are prepared to put in as to what the outcomes are

      • Lifelogic
        Posted August 24, 2019 at 11:07 am | Permalink

        I am an atheist but I am not at all sure that I think all people are equal. What exactly does all people being equal actually mean anyway.

        Is someone likely to die within the week (from some condition or other) equal to a healthy young child with a full life ahead of them? Is a child in the womb equal to a teenager? Is a serial mass murderer equal to a doctor who has saved hundreds of lives with his skills?

        “Equal” in these matter is rather a meaningless term.

        • L Jones
          Posted August 25, 2019 at 12:02 am | Permalink

          No, we’re not all ”equal” by any means in a human sense. But as long as we are equal before the law, that’s what matters.

        • agricola
          Posted August 25, 2019 at 1:23 pm | Permalink

          Equal under the law until it is contravened, they then become the accused.

          Equality should be of education opportunity. However for some, due to no fault of their own cannot be equal even in ths repect. For them society has a duty of care.

  13. BCL
    Posted August 24, 2019 at 6:17 am | Permalink

    “Taxing the rich” is a sentiment based on envy. I can see no justification for trying to do something about inequality, income or capital. In my view the question is not whether you have more or less than me but whether I have enough. If I am able to feed, clothe, house and entertain myself and my family adequately then I have no cause to make comparisons with others who have more or less than me.
    I would not regard any of the people in the examples as rich. £1M for a lifetime’s work is a comfortable figure but not “rich”. However, even if I did think they were rich I wouldn’t think that justified stealing their assets or income to fund those who have been less hardworking, prudent or even lucky.

    • Lifelogic
      Posted August 24, 2019 at 11:10 am | Permalink

      Exactly if you can afford to eat, drink, are healthy and have somewhere to live you are very rich compared to very many people in this world. A basic safely net is all that should be provided by the state.

  14. Lifelogic
    Posted August 24, 2019 at 6:18 am | Permalink

    Taxing the rich?

    Well first of all do not push them into leaving the county (and investing eleswhere) so you still have some rich left to tax!

  15. rick hamilton
    Posted August 24, 2019 at 6:23 am | Permalink

    If somebody with a net worth of one million is a millionaire them the word has lost its meaning of great wealth. A million in investable liquid assets would be a better definition.

    • Lifelogic
      Posted August 24, 2019 at 12:25 pm | Permalink

      £1 net assets will still go quite a long way in many countries and even in many parts of the UK.

  16. Walt
    Posted August 24, 2019 at 6:38 am | Permalink

    Definition of a rich person: someone who can live on the income of his income, (quote attributed to Lord Rothschild).

    • Woody
      Posted August 24, 2019 at 7:36 am | Permalink

      Then you have to define living … hand to mouth feeding or opulent restaurants daily, second hand clothes or the latest fashion, a roof over the head or a mansion and gardens, holidays in the local park or jetting off to Monaco … and much more.

    • James1
      Posted August 24, 2019 at 8:15 am | Permalink

      Is someone who has a million pounds but debts of more than a million pounds rich?

      • Lifelogic
        Posted August 24, 2019 at 11:14 am | Permalink

        Not not unless he had invested the million in something returning more (after tax) than the interest on the million of debt. Given the rip off banking margins and excessive tax rates currently this is not that easy.

  17. Bryan Harris
    Posted August 24, 2019 at 6:40 am | Permalink

    Considerations from labour about taxation are bound to be biased and totally aberated with dogma as to be worthless… A Tory party should pay no heed to a political party that cannot even manage their own finances with financial support from the Unions.
    I keep on sayimg that there is no no point in fiddling around the edges with tax reform – We need a total revamp, which needs to look at all angles, including reducing the cost of collection.

    We need to make basic living cheaper by removing VAT from items required just to survive, but then we should use VAT to take in a greater proportion of tax income. Increasing VAT on luxury items would give the appearance of FAIRNESS

  18. oldtimer
    Posted August 24, 2019 at 6:47 am | Permalink

    None of those examples are “rich”. We actually need truly “rich” people who are able and willing to invest and risk some of their wealth in creating the next generation of products and services which will make life better. To encourage that outlook and behaviour requires a much more pragmatic approach to taxation. That approach should eschew the idea of punishing wealth, which has dominated post WW2 tax policies, and instead towards that of encouraging savings and investments. A good start would be the simplification of taxes by elimination of the inefficient taxes (and the outright unjust) and the neutralisation of tax rates by harmonisation of rates charged to say 20%. Let us hope that the presence of reform minded advisors in the government can have a positive impact on savings, investing and on government tax revenues.

  19. Lynn Atkinson
    Posted August 24, 2019 at 6:55 am | Permalink

    How rich is somebody in a Council House and Stat€ benefit? Let’s say they have 2 children. The State has to deploy £1 million of capital to provide them with their home and income, so are they ‘rich’ and should they be taxed more? In global terms they are very rich which is why migrants are determined to get to Britain – to live like Lords without having to work.

    • SecretPeople
      Posted August 24, 2019 at 11:13 am | Permalink

      An old school friend of mine regards me as ‘far right’ because I support leaving the EU. We are the same age, similar background. I have worked for all my adult life and she has chosen not to. The state has supported her throughout her adult life and she volunteers at a community garden scheme – something I would love to do if I were ever allowed to retire. But our mortgage still has 14 years to run and our mortgage debt is too frightening to quote here, so I must keep working. She resents the rich – but she is rich.

    • tim
      Posted August 24, 2019 at 2:04 pm | Permalink


      • Lifelogic
        Posted August 24, 2019 at 5:28 pm | Permalink

        I do not think very many of them actually do that!

  20. Stred
    Posted August 24, 2019 at 7:00 am | Permalink

    When Scooter Boy hit the French with a wealth tax on worldwide assets including children’s, they moved out of France. If the ConLibLab shower do the same, the British will be off too.

    • Lifelogic
      Posted August 24, 2019 at 7:51 am | Permalink

      The ConLibLab shower have done the same already. We have the highest taxes for 50 years and the most complex and idiotic tax system ever thanks to the economic idiots Brown/Osborne/Hammond

    • oldwulf
      Posted August 24, 2019 at 8:43 am | Permalink

      @Stred. Many of the British “rich” have already gone. Perhaps the government should ask them why they went and what would need to be done (or undone) to entice them back.

  21. Everhopeful
    Posted August 24, 2019 at 7:04 am | Permalink

    Yes..well what is described above is exactly the ghastly dilemma most will face at some spend or save? To risk the 7 year rule?
    We are all stitched up with very few options.
    Can’t put money in the bank and get a good rate of interest. That is what the bankers did to us all.
    All part of the great redistribution wheeze so gleefully leapt upon by the liberal virtue signalling Tories.
    Turn various groups against each other and you can tax/ steal from the victimised group til the “pips squeak”. (Betrayal by Tories on RPI for civil servants..a govt “hate” target..but that was theft not taxation). Oh yes..and we were “All in it together” Ha!
    Isn’t there also some retrospective tax grabbing from people who invested ( apparently totally legally) and are now facing huge tax bills? Not so long ago the media invited widespread hatred of various celebs for similar. Baiting.
    Still if Corbyn is given the keys to No 10 we can all whistle. Devastation.

    • Everhopeful
      Posted August 24, 2019 at 7:28 am | Permalink

      I can’t actually think of any justification for forcibly taking earned income from anyone.
      I suppose one argument could be that the tax gathered money is used wisely and for the good of all in accordance with the wishes of the taxed.
      But the swag is NOT used like that.
      It just isn’t.

  22. Ian Wragg
    Posted August 24, 2019 at 7:08 am | Permalink

    We are somewere in between. Having unexpectedly inherited a house which we neither need or want on its sale we are informed there is Capital Gains Tax to be paid. If we give the balance to the morally rightful sons then they are liable for a 40% gift tax if we don’t live for 7 years.
    Sheer greed by the government to waste on useless projects.

    • Everhopeful
      Posted August 24, 2019 at 9:49 am | Permalink

      Ian Wragg
      Would a Deed of Variation work in your case?

      • Ian Wragg
        Posted August 24, 2019 at 11:41 am | Permalink

        Tried that. Solicitor says no hiding place.

      • Fred H
        Posted August 24, 2019 at 12:17 pm | Permalink

        It should!

      • hefner
        Posted August 24, 2019 at 9:13 pm | Permalink

        Have you considered going to another solicitor? Even in the absence of a will from the originally deceased person, provided you, your wife and your children all agree, a Deed of Variation costing less than £400 (I think, sorry if it is now a bit more) would allow the house to go to your children. I know of a very similar case last year, which was solved by such a document.
        Can anybody here confirm that it is the case, thanks.

    • Lifelogic
      Posted August 24, 2019 at 5:31 pm | Permalink

      If you inherited a house on death there is not usually any Capital Gains possibly IHT. Perhaps a tiny amount of CGT if it has gained a little since the date of death.

      • Stred
        Posted August 24, 2019 at 9:09 pm | Permalink

        Correct. Don’t trust solicitors.

    • Fred H
      Posted August 24, 2019 at 8:17 pm | Permalink

      Maybe YOU should not be selling it, but within 2 years of death operate the deed of Variation, to pass inheritance to ‘the sons’. They will have the problem of sorting it.

  23. Shirley
    Posted August 24, 2019 at 7:12 am | Permalink

    We are taxed at several stages. First our income (for the majority who cannot afford tax avoidance measures), then our taxed income is taxed again with VAT, SDT, Council tax, BBC licence, fuel tax, insurance tax, etc. There is very little that can be bought without paying additional taxes.

    • libertarian
      Posted August 24, 2019 at 6:36 pm | Permalink


      Absolutely it staggers me why we tolerate this, government has become a scam of epic proportions

  24. percy openshaw
    Posted August 24, 2019 at 7:18 am | Permalink

    I agree with the commentator who says that in fact, none of these figures is truly “rich”. Wealth involves the notion of a disposable surplus. These people need their capital in order to survive the next twenty to thirty years – at least in the fairly modest comfort to which they are accustomed. Personally, I think poor “Mrs D” tremendously ill-advised. It remains the case, however, that Labour, for bone-headed reasons of dogmatic ideology, will pretend that they are “rich” and do its best to fleece them. It resents their smidgen of independence and wishes to make them dependent on the State – meaning, of course, on Labour. It is the love of power which actuates the Marxist; they condemn charity as “sentimental”. Lenin angrily barged his way out of a performance of Dickens’s “Cricket on the Hearth” for this reason. Dickens, of course, with his belief in hard work and self-help, was the reverse of a socialist – not something many people today will realise.

  25. J Bush
    Posted August 24, 2019 at 7:25 am | Permalink

    What I would like to know is, will Corbyn & McDonnell confirm, if they got into No10 and executed their plan to tax everyone with a garden, given money to an offspring to help them through uni, or for a deposit to buy their own home, or have assets worth £1m or more, they will be including themselves in this tax grab, or will they make themselves exempt? Or will they allow this to be paid under ‘expenses’?

    • Jiminyjim
      Posted August 24, 2019 at 7:50 am | Permalink

      We should all be very scared of the fact that Corbyn and McDonnell are keeping very quiet about their real plans for taxation. One of the things that I’m told they have ‘up their sleeve’ until they’ve been elected is a tax similar to Francois Mitterand’s so-called ‘signes exterieures de richesse’ which gave the french government the right to estimate what an individual’s real taxable income was, rather than declared, based on his visible possessions. Boris needs to be acutely aware that this is where we’re headed if he stitches us up on the WA

    • Fred H
      Posted August 24, 2019 at 12:22 pm | Permalink

      Corbyn and McDonnell et al will send new hordes of ‘lower paid’ people to spend what little they have and resort to the state looking after them, zero incentive to save, be prudent, look to their future. A new version of Brown buying benefit votes, but watch the economy nosedive, debt escalating etc.

  26. Arnie from Newington
    Posted August 24, 2019 at 7:27 am | Permalink

    I am a higher rate tax payer earning only £33k due to the way section 24 tax is calculated.

    As this tax was introduced by Osbourne and not repealed by Hammond I won’t be voting Tory anytime soon.

    • Lifelogic
      Posted August 24, 2019 at 7:55 am | Permalink

      It is an outrage, unsustainable, hugely damaging and grossly unfair. Hitting both landlords and tenants un fairly and the housing stock quality and availability.

  27. JoolsB
    Posted August 24, 2019 at 7:35 am | Permalink

    A group you haven’t touched John are all those youngsters in England coming out with meaningful degrees and doing meaningful jobs, the scientists and doctors the country needs. Unlike those doing meaningless degrees and getting low paid jobs and therefore probably never paying anything back, the scientists and doctors if they are on incomes say of £50-60k could be paying as much as 61p in the pound income tax for the first thirty years of their working lives. What a massive burden at a time when they will be wanting to buy homes and start a family. What incentive do you think they will have to stay and work in this country?

    Any Government with any common sense and sense of fair play would scrap all debt for STEMM subjects on condition they stay and work in this country/the NHS for say a minimum of 10 years.

    Your Government has created a system where only those professions we need will be heavily penalised but only if they are English of course. Oh well at least their taxes will help carry on paying for all those doing meaningless degrees and those free tuition fees in Scotland and heavily subsidised ones in Wales & NI. .

    • Fedupsoutherner
      Posted August 24, 2019 at 2:26 pm | Permalink

      Spot on Jules.

    • Lifelogic
      Posted August 25, 2019 at 4:45 pm | Permalink

      Much truth in that. A doctor may end up with perhaps £250K of student debt after 5/6 years increasing at up at 15K PA in interest!

      The NHS perhaps paying them a starting salary of £25K!

  28. Alan Jutson
    Posted August 24, 2019 at 7:44 am | Permalink

    The problem with so many tax initiatives is that they complicate human natures actions, and very often create a Citizen against the State effect.

    For too long we are seeing taxes and state benefits being used as a social engineering project to try and make all people equal in some twisted mindset experiment, which is doomed to failure.

    Goose and Golden egg spring to mind.

    Amazing that many of those who want everyone else to be equal, always want the best for themselves, with a high salary, excellent pension arrangements, Long holidays, private health cover, private education for their own children, long holidays, and many other in service benefits.

    • Alan Jutson
      Posted August 24, 2019 at 7:46 am | Permalink

      Oh did I mention long holidays, preferably and often at someone else expense, and of course abroad, under the guise of a conference or something similar.

  29. alastair harris
    Posted August 24, 2019 at 7:47 am | Permalink

    We have become used to governments of both left and right using tax as a virtue signalling device, and most recently Mrs May’s Government joining the left in seeking to vilify high incomes and wealth. I believe Boris standing against such policies is one of many factors responsible for the “Boris bounce”.
    Tax is supposed to fund government policy and the day to day costs of government, balanced with borrowing (tax on future generations). You can make a case for fiscal and monetary policy to “manage the economy”, particularly if you enjoy fairytales!
    The fact is the government spending is less productive than private spending, whether that is for consumption or investment. By definition Governments are not subject to market forces. We all accept that some government is a good thing, although I sometimes wonder why. But we have too much government, too much interfering, too much regulation, and too many politicians with time on their hands. We can see parliament fiddling around whilst the country suffers the pain of dithering over Brexit, for example.
    It is good to debate the issues of taxation, but the focus should be on the appropriateness of government spending and the unfairness and cost of the complex system we have.

  30. Julie Williams
    Posted August 24, 2019 at 7:49 am | Permalink

    I thought Mr C was going to be a career politician who’d never had a proper job and got his mates to employ his kids, but then, you only set the bar at one million pounds.

    It’s a puzzle, but there has to be safeguards around being self-reliant and the ability to pass something down to following generations enables them to do so as well.
    At the minimum we should protect the property in which people live, it’s not an asset, shelter is a basic human need.Perhaps all four examples should be allowed to do what they like with the fruits of their “home”:the D’s are in for a shock when they come to rely on benefits.

    A fantasy world of shiny, happy people all with the same (wonderful) assets and prospects bucks human nature.Its why trade union leaders get paid substantially more than the average worker…did Scargill go hungry with the ordinary miner?

    • tim
      Posted August 24, 2019 at 2:18 pm | Permalink

      my friend from spain {very well educated} was amazed and disgusted, his question was, what chance of social/financial advancement, I explained that the Tories make sure when you die they take everything, there is no chance of passing anything to your children. Unless you are rich, and of course the rich do not pay tax!

  31. Al
    Posted August 24, 2019 at 7:50 am | Permalink

    I look to Carnegie on this.
    The question is what behaviours do you want to encourage over lifetimes?
    At one end you have the person from a poor background building large businesses that benefit society hugely.
    At the middle you have the easyJet founder started out with millions and created huge wealth and value by being entrepreneurial, at the other end you have the multi generational inheritees who are risk averse hoarders.

    Who do you want to see living in the best house in the street? (Based on societal benefit)?

    For my money it’s not the inter-generational hoarder.

    I favour merit more than inheritance.
    Perhaps some system where IHT is based on an individual’s lifetime income tax paid. E.g. wealth passed down by an individual who has already paid income tax on it is not subject to IHT.

    • Arnie from Newington
      Posted August 24, 2019 at 5:15 pm | Permalink

      Inheritance tax is a completely flawed tax.

      If inheritance Tax was paid when the Duke of Westminster died it would have doubled the annual inheritance tax take.

      By using a trust they were able to pass it onto the new Duke without paying Inheritance Tax.

      Meanwhile those who have worked a life time and have a house they have spent there life paying for are paying 40% tax.

    • Lifelogic
      Posted August 24, 2019 at 5:38 pm | Permalink

      I favour no IHT at all. It has been taxed far too much already as has any income from the capital. It creates perverse and damaging incentives encouraging people not to bother working or to increasing their wealth further. Or to give it away early which is not always a good idea.

      • Fred H
        Posted August 24, 2019 at 8:08 pm | Permalink

        HOW TRUE!

  32. BJC
    Posted August 24, 2019 at 7:53 am | Permalink

    To understand Labour, we need to look no further than the ideology of Marxism, i.e. “the opposition to an economic system based on inequality and on the alienation and exploitation of “the majority” (by means of the system of wage labour), a system whose purpose is to obtain profits for some people rather than satisfying the needs of all”.

    There’s really no need for Labour to decide what constitutes wealth. They can simply define anyone who enjoys the smallest of disposable income or assets as “rich”, which will fuel the destructive and basic human failing of envy, i.e. it would be decided by the “put-upon majority”.

    Of course, Labour’s theory of keeping “the majority” dependent on the wealth-draining State ignores the fact that it would systematically drive away or impoverish those required to pay for it. In doing so, the point at which “the majority” were considered rich would reduce in tandem. Things formerly considered necessities would be redefined as assets, with far more of “the majority” affected as the State fought to fund its largesse. The only people immune to this State theft would be those working as part of the State machine.

    On reflection, I feel I’ve just described the EU……..

  33. Dominic
    Posted August 24, 2019 at 7:54 am | Permalink

    Understand one simple truth. Labour is a political animal. Its entire being is concerned with one simple aim, to protect and promote the interests of the Labour party. Its concern is not a concern for you and your family. Its concern is not for general health of other people. Labour’s only concern is entirely political. Humanitarianism and compassion for people is merely a cover for their (unpleasant ed)attitude

    Marxist Labour will invoke all tactics to trigger the emotions and imaginations of their core voters including the usage of the idiotic terms ‘rich’ and ‘poor’. Other triggering terms include ‘the nasty Tories’ and ‘selfish’.

    Labour know full well that you cannot in any meaningful sense explain and describe the absolute complexity of the dynamic real world and therefore rely on narrative or fantasy as I would call it. They are a deceit on us all. They’ll conceal all that tarnishes their warped world view and their backward opinions

    And their aim? Their aim is simple. It is the construction of a socialist client state using YOUR money. That client state would be loyal to Labour and it would protect and expand the interests of Labour. This client state would be beyond reform. To achieve this oppressive plan Labour must encourage a high tax culture and create the idea that high tax rates (relative) are an expression of human concern. It is this LIE that sticks in the gullet.

    In effect the taxpayer is encouraged to pay more to finance the Labour party’s efforts

    Self-reliance and a small state is a threat to Labour’s aim to construct all empowering socialist client state in which each citizen is a mere cog rather than a individual human being in their own right.

    I just want free people to understand the existential threat of Labour. I believe they are a dangerous party with dangerous leaders and the Tories simply aren’t doing enough to expose these people and their histories.

  34. Fedupsoutherner
    Posted August 24, 2019 at 8:02 am | Permalink

    Meanwhile, the feckless, and we all know who they are, live a lifetime off the state and then get their full state pension too. That’s what I call rich!! No wonder our taxes are constantly going up and the left wingers all think they deserve more!! Many times we hear people moaning about their lot and they have numerous children in tow, never been married or in a stable relationship and have the cheek to moan about how low their incomes are and what shoddy housing they have. Do they ever think about the taxes we pay?

    • Matt Ryan
      Posted August 24, 2019 at 12:33 pm | Permalink

      There are now complaints (Baroness Altmann) about putting up the pension age as a consequence of the state no longer being able to afford it. People complaining that they can’t be a driving instructor after the age of 60 as they are doddery.

      A pension is not a basic human right. You haven’t paid in all your life (in fact it was squandered they year any NI contribution was made). Nothing stops you changing career if you can perform adequately in the one you have.

      Presumably taxing the rich more will make up for it.

  35. libertarian
    Posted August 24, 2019 at 8:04 am | Permalink

    Everyone earning money in the UK pays nearly 40% of it to the government ( for them to waste on pork barrel, boondoggle projects)

    Income tax National insurance council tax VAT, duties on fuel , cars, alcohol etc. insurance premium tax, IHT, stamp duty . Thats without parking, speeding and other tax fines

    Government should be ring fenced and allowed to provide the basic necessary public services

    All those that clamour for “the rich” to pay more tax need to wake up and realise who really pays this

    Tax must be simplified, minimised and all loopholes closed . Straightforward tax so that we know what we are paying and what we are getting for it

  36. A.Sedgwick
    Posted August 24, 2019 at 8:22 am | Permalink

    My definition of rich is those who use tax lawyers and accountants. The tax system should be simple and flat, not confused with/by benefits and fair to all without their need. One of the delightful ironies is all governments foster their existence, perhaps they may disappear one day like saggar maker’s bottom knockers.

    • Shirley
      Posted August 24, 2019 at 10:04 am | Permalink

      The majority of the self employed and small company owners NEED an accountant to guide them through the complex tax system, which changes frequently. Unless you can spare weeks of you life determining the changes each year and how you need to adjust your business accordingly, then it is much cheaper to employ an accountant than try to do it yourself and get it wrong.

  37. Andy
    Posted August 24, 2019 at 8:26 am | Permalink

    How about Miss E.

    Miss E is 32. She is a fully qualified doctor – having studied for 7 years.

    She has around £100,000 of debts – accumulated at university.

    She never has a hope of getting on the property ladder so she rents.

    Her elderly landlord – who has three or four rundown properties he bought for £32 each in 1964 – is never there to fix things because he is always on cruises.

    He walked straight into a well paid job, despite having no qualifications. He benefitted from then huge economic advance the UK enjoyed thanks to Margaret Thatcher’s single market. But he voted for Brexit because he does not like foreigners. He gets a state pension and lots of old age benefits.

    Should Miss E be in poverty or should we start taking assets from her landlord instead?

    • Sir Joe Soap
      Posted August 24, 2019 at 10:10 am | Permalink

      Makes your landlord born in about 1930. He lived through the war, with ration books, probably lost friends who were killed by enemy bombs. His parents were probably wounded in action in WW1, then came back to spasmodic employment. They never gave him foreign holidays or other luxuries your doctor has taken for granted. This isn’t fantasy – it describes my parents precisely.

      He was then either very fortunate or having great foresight to buy properties for the amount you state. Probably bombed out derelict wrecks, which despite his start in life he managed to renovate and let.

      House prices also went up in the USA, Australia and many other countries which weren’t either run by Thatcher nor were they in the Single Market. Nevertheless our landlord just kept his properties to pay him a pension through rent. Then Brown stopped him placing them in his SIPP, Osborne caned him when he mortgaged them to provide the last vestiges of luxury in his fairly spartan life. Hammond and May slammed more fees and liabilities on him through the Tenant Fees Act.

      Can’t blame him if he took a one way cruise and never came back to his whinging tenant, frankly.

    • Edward2
      Posted August 24, 2019 at 10:12 am | Permalink

      I fail to understand why a well paid doctor cannot afford to buy a property.
      There are jobs for doctors all over the UK and there are properties available for well under £200,000 in every town and city outside London.

      • hefner
        Posted August 24, 2019 at 12:14 pm | Permalink

        How large do you draw your “London circle”?

        • Edward2
          Posted August 24, 2019 at 10:59 pm | Permalink

          Like the rest of the UK apart from London.
          Try a website that gives you availability of properties for sale at different price points.
          Surprise yourself hefner.
          You metro London types are so isolated.

          • hefner
            Posted August 26, 2019 at 11:46 am | Permalink

            You miss the point (as so often when you jump on what I write): Reading (40 miles from Westminster) has practically no properties below £200k. Even a two-up, two-down has been above £200k for at least three years (when my son bought his first house). And an (admittedly) cursory look at other towns within the same radius of central London appears to show the same situation. You know, Edward2, not everybody can be a successful businessman nesting in the boonies as you are/were.

      • margaret howard
        Posted August 24, 2019 at 12:35 pm | Permalink

        Trust Edward to get the wrong end of the stick.

        • Edward2
          Posted August 24, 2019 at 11:24 pm | Permalink

          What stick is that Margaret?

      • JoolsB
        Posted August 24, 2019 at 3:08 pm | Permalink

        Edward, doctors don’t earn decent money until they become Conultants and have been qualified for a good few years. After 6 years of study they can expect to start on a salary around £23k, £29k in London. Meanwhile they will be paying off a £100k debt at an extra 9p in every pound for the next 30 years once they earn over £25k. No wonder they take their services abroad. We should not be lumbering the Stemm subjects with these sorts of debts.

        • Anonymous
          Posted August 24, 2019 at 11:14 pm | Permalink

          On top of which they must pay insurance. An F1 of my son’s med school was killed on the commute from a 90hr week recently.

        • Edward2
          Posted August 24, 2019 at 11:26 pm | Permalink

          New GPs earn 45k rising to 100k.
          And there are vacancies all over the UK
          Don’t try to claim they can’t afford a mortgage.

          • hefner
            Posted August 26, 2019 at 1:31 pm | Permalink

            Edward2, Look for ‘Pay for doctors’
            It depends what one is calling a ‘new GP’. Your numbers fit a Consultant, not a person actually starting in the NHS. Such people can get additional money for hours over the statutory 40 hours, for work on week-ends or if called for some emergency work. However, the main point is that the basic starting salary is not £45k. So is that another of Edward2’s claims going to the bin?
            What about learning how to look for things on the web?

        • a-tracy
          Posted August 25, 2019 at 9:29 pm | Permalink

          Degree qualified Nurses start on more than £23k Jools?

    • libertarian
      Posted August 24, 2019 at 10:42 am | Permalink


      Er you forgot to mention that a fully qualified GP earns around £100K and has a kid at private school apart from that top analogy….


      Why would she CHOOSE to live in a run down property?

      If her landlord is elderly why would you want HIM to fix things ?

      As he has income from rental properties What exactly are the old age benefits he gets ?

      What assets does the landlord have that you wish to steal apart from a run down house?

      ps in the real world as a qualified Doctor she would have no problem getting a mortgage on a property if she wanted

      dumb and dumber Andy

    • A different Simon
      Posted August 24, 2019 at 11:50 am | Permalink

      Andy ,

      The older generation has indeed failed to make the essential inter-generational transfer to following generations necessary for the newer generations to succeed , let alone pay the pensions of the previous generation .

      Specifically they have voted for parties which have not invested in creation or maintenance of infrastructure including accommodation or education (student loans and poor teaching) and health which will enable following generations to make a living in a global market .

      The older generation benefited from inflation especially wage inflation which typically eroded the mortgage principle in real terms by two thirds of a house purchased in 1970 by 1980 .

      They don’t want to hear that the only way for houses to increase in value beyond inflation is for the next buyer to borrow more in real terms than they had to .

      They have elected Govts which have deregulated finance which has turned the masses into debt serfs . Failed to tax away capital gains on houses which means they are captured by their real masters ; the mortgage lenders .

      The figures do not support your claim that the UK benefited from a huge economic advance by joining the single market is incorrect . The decline we have experienced since joining might have happened even if we had not joined the single market .

      A lot of good salt of the earth working class people voted to Leave and it is offensive to suggest that people voted to leave because they don’t like foreigners .

      If you want to live in a country where the Judiciary has at least some independence from the Executive or deselect politicians , then the E.U. is not for you , is it ?

    • Fred H
      Posted August 24, 2019 at 12:34 pm | Permalink

      The elderly landlord was a genius – wish I could have bought 3 or 4 properties for £32 each in 1964 – 2 weeks average wages? More like £3000 each which were of rentable condition. If she rents such a rundown place its her fault, and she should complain to him, and the agent if one, or the local council. The old chap ‘walked into a well paid job’ another miracle step, he should be a consultant to students.

    • Matt Ryan
      Posted August 24, 2019 at 12:35 pm | Permalink

      In no case should the landlord have anything confiscated (taking assets).

    • tim
      Posted August 24, 2019 at 2:27 pm | Permalink

      FULLY QUALIFIED DOCTOR £250,00 a year,plus all the private work she wants. what about the 6 million of us on minimum wage zero hours contract, because of the endless almost free supply of labour via EU. that is one reason I want out of EU

    • Richard1
      Posted August 24, 2019 at 4:53 pm | Permalink

      oh but think about Mr F, a very hard working 38-year old entrepreneur. He only earns £40k but at the last valuation his stake in his Company was worth £10m. He is very worried as he isn’t allowed to hire the Bangladeshi, Canadian or Australian developers he wants to, he’s told it’s too difficult & he can only recruit from within the EU, where it’s difficult to get the right people. In the UK he sees the possibility of a virulently left wing govt wanting to confiscate his wealth and maybe his company if it succeeds. he sees an EU thinking up new taxes to disadvantage his digital business, should it ever become successful. His competitors in Singapore and the US face none of these issues.

      The other day he had a very unsettling experience. He went to a local event where he met a very voluble and angry middle aged person, Mr A, apparently quite prosperous, but loud in his hatred for anyone who disagreed with him, boastful of his material success but bitterly chippy and resentful of the really successful people who had backed Mr F’s business, and without whom it wouldn’t exist. Mr A told him that anyone wanting to have equal immigration rights for non-EU citizens (like the ones Mr F wants to hire) is a racist, and that his wealthy investors are parasites.

      Fortunately Mr F recognises that the Marxists won’t get in and destroy everything he’s worked for, and that though people like Mr A are enormously over represented in the media, there aren’t very many of them.

  38. Andy
    Posted August 24, 2019 at 8:36 am | Permalink

    My family pays a vast amount of tax. My wife and I are both among the top earners. Crucially although it is a large sum we do no begrudge it because we know we are more fortunate than most. Unlike the really rich Tories who keep their cash stashed in tax havens we are quite happy to pay our share. And our share pays the salaries of a significant number of nurses.

    The real challenge is to make it so morally unacceptable for the tax haven brigade to avoid paying their share that they start to contribute properly. Tax cuts for average earners mean nothing. It is a handful of pence. What we must do is make sure the yacht brigade are shamed into properly contributing.

    • Edward2
      Posted August 24, 2019 at 10:08 am | Permalink

      Smaller state equals less tax for all.
      The state is huge and increasing its borrowing, taxing and waste every year.
      Just chanting “tax the rich more” like some teenage student on a demo, isn’t the answer.
      A tax cut for average or below average earners mean a lot to them.
      Over 50% now pay no income tax whilst the top 1% now pay 28% of all income tax collected.

      • Andy
        Posted August 24, 2019 at 10:50 am | Permalink

        Have a smaller state then. But be honest about what you want to cut.

        I want to entirely axe the state pension, state social care for the elderly and OAP benefits. I also want the old to pay more for the NHS as they use it most. And I want to all but scrap the defence budget. These are big sums which would enable us to cut your tax by 30-40% or more.

        You want to axe overseas aid and leave the EU. So that’s 1% of state spending. That kind of tax saving will, perhaps, buy me a small latte a month.

        • Edward2
          Posted August 24, 2019 at 11:12 pm | Permalink

          Weve just wasted billions on HS2, billions on over priced nuclear deals, billions on overseas aid and billions on green subsidies.
          Just four examples of savings.
          Equal contributory pensions for private and public sector means billions more saved.
          Child benefit max three chikdren.
          Close the House of Lords means millions more saved.
          Just a start

    • Sir Joe Soap
      Posted August 24, 2019 at 10:11 am | Permalink

      Lucky you.

    • libertarian
      Posted August 24, 2019 at 10:51 am | Permalink


      For someone who claims intellectual superiority and who claims ( not believed) to have run a successful business you are completely ignorant of the tax system

      So you and your wife are both top earners , really? But you told us you closed your business and sacked the 6 staff because of Brexit…. so what is it that you and your wife now do for a living?

      You might want to find out what a “tax haven” actually is first and how they operate

      TIEA makes it compulsory to share tax information between signatories and MLAT requires co-operation in matters of legal enforcement and criminal investigations. Investors thinking of using tax havens and offshore banking locations should take note of the Liechtenstein( an EEA country) banking scandal in 2008. This scandal came to light when Germany initiated a series of tax investigations based on bank account information sold by a bank technician. Many citizens of Germany who took advantage of a Liechtenstein-based trust structure for evading tax in Germany found themselves in trouble.

      You tax does NOT pay for any nurses there are no ring fenced taxes, your taxes like ours pays for MP’s, members of the House of Lords, HS2, civil servants salaries etc etc

    • The PrangWizard
      Posted August 24, 2019 at 12:27 pm | Permalink

      It is not morally acceptable for you to display your envy and resentment of rich ‘Tories’, and to single them out as targets for your class hatred. Is your social and financial position as you state it to be, I wonder. I dare say though there are a great number of the ‘rich’ as described who are of the Left.

      I don’t suppose it has occurred to you that to very many people here you are ‘rich’ and they probably resent your sneering at lower earners. Tax cuts for them – me included – are worth having, even if you think it’s only pennies.

    • Fred H
      Posted August 24, 2019 at 12:37 pm | Permalink

      Rather than paying for nurses’ salaries it is probably paying for a few dozen unskilled immigrants. You’ll get your reward in heaven. Or a Nobel prize.

    • Christine
      Posted August 24, 2019 at 1:18 pm | Permalink

      What sort of job pays this well and allows you to spend hours on this site every day?

      I’m sure we all want to know.

    • Barry
      Posted August 24, 2019 at 1:48 pm | Permalink

      “rich Tories who keep their cash stashed in tax havens”
      “tax haven brigade”
      “yacht brigade”

      Lazy, sneering assumptions.

    • Richard1
      Posted August 24, 2019 at 4:23 pm | Permalink

      The highest earners pay more than ever before, both in £ and as a % of total receipts.

    • Robert mcdonald
      Posted August 24, 2019 at 4:26 pm | Permalink

      Really rich Tories? Like Blair ?

      • Robert mcdonald
        Posted August 26, 2019 at 9:39 pm | Permalink

        Indeed like the Gary Linekers of this world.

  39. Gareth Warren
    Posted August 24, 2019 at 9:03 am | Permalink

    All of these are rich, often due to rising asset prices. But realising a sale of the house often means moving away from the area and a severe loss of social contacts.

    I do not believe we can take assets fairly, nor would it last. But I do believe the field has been tilted towards those who borrow first with low interest and help to buy schemes – even high immigration as a government policy pushes them up, people will look at houses and decry them.

    Here an alternative place to invest money, higher qualifying requirements for borrowers, less inheritance and less immigration will bring them down.

    I also note there is a old guy earning a (high salary ed) from the state should be called out as a rich millionaire – perhaps Mr Corbyn shouldn’t earn multiples of an average salary if he does not believe others should. (words left out ed) But socialists always seem to be happy living a millionaire or billionaire lifestyle. (Chavez’s daughter is worth A large sum……).

  40. Jim
    Posted August 24, 2019 at 9:25 am | Permalink

    The other category of person who could be considered ‘rich’ are those who have State funded pensions, which equate to massive pension funds – as we have seen recently, senior NHS staff are quickly running up against the £1m pension fund limit and getting big tax bills as a result.

    So is a retired school headmaster or GP who has an index linked pension of say £50k/yr rich? To buy that pension in the open market for cash would take a huge capital lump sum, circa £1.8m at current rates. So should a person who has £1.8m in cash sat in the bank (or in investments) pay the same tax as someone with a a State funded pension of £50k/yr?

  41. hefner
    Posted August 24, 2019 at 10:09 am | Permalink

    Can’t anybody see what Sir John (once again) is doing today? Asking us to ‘advise’ him on a case that for the majority of people in the UK is largely irrelevant.
    In the SE of England, it might be another story as many people getting to their fifties having had a more or less secure job since their thirties are likely to be in the described £1m situation whether they know it (likely) or nor, when adding the value of their properties (at least 5% growth per year for twenty years), the money accumulated in their pension pot (again over roughly twenty years), plus their possible savings. Are these SE people really ‘rich’? To me they are not but have been the preferred cash cows for successive HMGs?
    Sir John’s test would be more relevant, at least to me, if it were to address the category of people with a wealth 10 times (and above) bigger. How such a wealth has possibly been accumulated? By inheritance? by actual creation of enterprise(s)? by being top dogs in companies being paid ‘small’ salaries but large additional allowances in shares and/or pension contributions? by being part of these circles of top non-exec directors getting £10+k/month per company for which they are consultants?
    Given that £1m is now near the bottom of annual pay for a large number of finances-related jobs, that to me might be a better set of questions to be debated.

    • James1
      Posted August 24, 2019 at 5:32 pm | Permalink

      The government should not be aiming for equality of outcome. They should be aiming for equality of opportunity. Most importantly they should be aiming to preserve and maintain our freedoms.

      • hefner
        Posted August 24, 2019 at 8:43 pm | Permalink


    • Edward2
      Posted August 24, 2019 at 5:41 pm | Permalink

      You really think Hefner that people get given high paid jobs just because they went to the right school or belong to a particular posh club?
      All the people I have ever met who hold top jobs in the private sector add value by manageng the growth, direction and profitability of their company.
      Shares and bonuses and dividends are a major part of their remuneration package
      Performance related pay.
      If the business plan and its targets are not achieved or profits fall they soon get chucked out.
      It is ruthless at the top.
      Mind you in the public sector, quangoland and charity land it is a complerely different story.

      • hefner
        Posted August 24, 2019 at 8:42 pm | Permalink

        Did I really think that? How brilliant you are at interpreting my questions above and twisting them according to your preconceptions of me!

        • Edward2
          Posted August 25, 2019 at 6:12 am | Permalink


  42. Fred H
    Posted August 24, 2019 at 10:14 am | Permalink

    Mr A – it is his choice, he is essentially poor, pays no income tax.
    Mr B ought to have a state pension too? He will pay tax on that + £50k pa – having surely used his 25% up? – not rich.
    Mrs C has chosen to pass money on, it is legal and untaxable if she survives 7 years. She will only just pay some income tax.
    Mrs D has cashed in her asset, but will pay possibly high rental. Spending at that rate will not last too long. She is not rich. Good luck with living off the state!

    Rich is possibly having several assets worth > say £3m and annual income > £250k.
    It is reasonable to remove income tax on income below £20k a good target. It should be gradually done by raising personal allowances – everybody benefits. That would also widen the advantage in working rather than living on basic benefits. The tax rates can be left as they are, Boris’ idea of easing tax on higher earnings is not the right measure.
    If Labour carry out punitive taxation on the ‘rich’ it will mean more people will take steps to not pay at all. A pyrrhic victory.

  43. NickW
    Posted August 24, 2019 at 10:14 am | Permalink

    The first standard definition of rich is “Those individuals with more money than “Me”.

    The second standard definition of “Rich” is “Those people without large debts”.

    People with large and unpayable debts consider themselves “poor” and will be all in for taxing the “rich” and voting militant socialist.

    Blair knew what he was doing when he introduced student loans for University fees. All those with large student debts will vote socialist in ever increasing numbers.

    The problem of student debt needs to be tackled in order to stem the flood tide of increasing socialism.

    • Fred H
      Posted August 24, 2019 at 2:21 pm | Permalink

      Most of those students will think ‘got my degree, will never have to repay’. In years to come as many will move up the earnings incline it will kick in, just as mortgages, weddings, children come along and they discover the now punitive interest building up. Blair shifted growing levels of youth unemployment to partying, oops sorry studying, and earning grateful student votes. A master stroke. Now we have thousands, maybe 100s of thousands of almost useless degrees.

  44. Edwardm
    Posted August 24, 2019 at 10:36 am | Permalink

    No-one can nor should determine anyone else’s financial decisions. JR’s illustrations above show how difficult and contradictory that would be.
    I think the state should not have any tax rates above 33%, and capital gains tax (if we keep such a tax) should only be charged on gains above the general level of inflation. Inheritance tax should have a higher threshold (£500,000 +), and the allowance for gifts should be raised. Stamp duty should be reduced.

  45. Dominic
    Posted August 24, 2019 at 11:02 am | Permalink

    A far more important question is how tax revenues are spent and why they are spent on financing certain aspects of State activity that appear not too have any discernible economic or social benefit.

    I believe that a significant proportion of annual State spending is superfluous and political and therefore unrelated to the provision of critical public provision. Much of this unnecessary and unjustifiable expenditure is a reflection of two important political dynamics both related to the two main parties

    One. The Tories when in government refuse to reform Labour’s client state activity that encourages expanded budgets and power-grab simply because they haven’t the courage or will to do so

    Two. Labour’s continual pressure to expand State activity thereby upping the need for further State spending increases that benefits Labour and its union backers power base

    Both of the above spell bad news for the hard-working private sector taxpayer.

    Understand that public sector workers do not pay tax of any kind unless they produce something for sale. Their salary deductions have already been by the private sector and is in effect double-counting

  46. Iain Gill
    Posted August 24, 2019 at 11:05 am | Permalink

    you are not rich if you are fairly old with young children, as you need to do your best to fund them once you are no longer able to work.

    you are not rich if you have old vulnerable relatives that it is likely you will have to bail out and support at some point

  47. The PrangWizard
    Posted August 24, 2019 at 12:32 pm | Permalink

    It’s expecting too much of course but we should try not to use ‘rich’ or ‘poor’ for that matter. It’s all relative and how many of those who complain about the rich do it out of envy and would love to be rich themselves. Certainly I would say that most Left wing activists and MPs and socialists in general would come into this category judging by the way they accumulate wealth when they get themselves in positions of power. Not many people aspire to be poor.

  48. Christine
    Posted August 24, 2019 at 1:15 pm | Permalink

    Mrs L is a divorced single parent working 16 hours per week on minimum wage. She receives £4,000 a month in child maintenance from her rich ex-husband. She lives in a £500k property with no mortgage. She received a £1 million divorce settlement that she invested in paintings and antiques for her home. She sells these as and when she wants a bit of extra cash. She qualifies for £350 a week in tax credits and child benefit because none of these assets or income is taken into account. Is life fair? No it isn’t. Etc ed

  49. BR
    Posted August 24, 2019 at 1:39 pm | Permalink

    My view is that none of them should be taxed – but then this is largely conservative (small c) audience.

    Those who avoid IHT by blowing the lot won’t be targeted by Labour’s tax madness. And therein lies the madness – encouraging profligacy encourages dependency – on people who pay taxes.

    The same people who blow their savings will be the same people who end up in care at State expense, which is why the State has to fund care for all lest it becomes necessary for all of us to blow the savings on holidays and fall back on the State.

    Those who clearly have a disease should be covered by the NHS (dementia in all its forms is now known to be a group of diseases, not a consequence of ageing yet politicians do nothing to change its status in ways that are meaningful for its sufferers).

  50. Dioclese
    Posted August 24, 2019 at 2:13 pm | Permalink

    I downsized my house in Winnersh and bought a smaller on in Suffolk, pocketing £400,000 in the process. I live entirely on income from that money and a state pension of around £600 a month. Am I rich?

    I intend to work my way through it before I die. If it’s all gone then at least the family can have the house assuming I haven’t taken equity release on it.

    The thing to note is that I have paid income tax, NI (employee and employer), capital gains tax on my investment as I realise them and stamp duty when I moved home.

    As I have already paid all these taxes, why should I be required to pay even more?

    And whilst Mr Corbyn is playing the socialist Robin Hood, perhaps he would care to comment on the value of his own house which I am given to understand is worth about £1.3 million? Clearly a hypocrite and by his own definition, a rich hypocrite to boot…

  51. mancunius
    Posted August 24, 2019 at 2:27 pm | Permalink

    Curiously, the only one of the four examples who will have increased his £1m assets (in fact massively so) by the time he dies, is A, the penurious pensioner who, since he is receiving benefits, has saved almost nothing over his working life – or possibly chose not to work, but that is unclear from the information given.
    One might say it is ‘his choice’, but is it? One might equally aver that it is the state’s interfering hand, by showering him with a lifelong undeserved pittance adequate to his needs, that is preventing him from making a personally and socially responsible choice.

  52. BillM
    Posted August 24, 2019 at 3:26 pm | Permalink

    In all of your examples, SJ, the £1m refers only to total assets. And there lies the problem. Asset values are meaningless in tax terms unless they are sold.
    Income tax, as its title infers, should be established from actual incomes. If assets provide an income, that too should be added to any other income source. Pensions are an income too.
    When it comes to selling an asset, like a second property, the profit should be taxed as would any rent returns from such a property on the Letting market. But not on the main residence which is more than just an asset – it is “Home”. And it must be excluded from any taxable evaluations.
    Stamp Duty should be applied to the sellers and not the buyers. This idea though, has been rejected by the new Chancellor. However, I suggest there should be, say, a minimum 12 month delay between the announcement and the incorporation of it. In this respect the current method of the buyer paying the “Tax” puts the burden upon them rather than the one who ends with the usual profits from the house sale.
    Overall the tax system in this country needs a complete overhaul and update. It has become too burdensome for both the Inland Revenue and the Private Sector and needs streamlining to ensure greater efficiency and a more user friendly understanding.
    Estonia did it, successfully. So why can’t we?

  53. Kathy Penney
    Posted August 24, 2019 at 4:02 pm | Permalink

    I believe it’s always been the case that keeping taxes as low as possible – for everyone – actually increases the Treasury’s revenue. Labour still can’t seem to get to grips with the logic of that. I wouldn’t care but they influence the more gullible to think that any tax cuts are for the benefit of the rich and to the detriment of everyone else. Once someone thinks that way, it’s impossible to convince them otherwise.

    • James1
      Posted August 24, 2019 at 5:45 pm | Permalink

      Loony left wingers, and certainly Marxists appear not to care if a tax levied at a ruinously high rate produces less revenue than taxing at a lower rate. They see it as a question of “fairness”. Quite extraordinary, and a clear illustration that their whole ideology is based on envy and hatred. It’s certainly not based on what used to be called common sense.

  54. simon
    Posted August 24, 2019 at 4:32 pm | Permalink

    Flat tax 20 or 25%. No deductions. Everyone pays from £1 of income upwards

  55. Iain Gill
    Posted August 24, 2019 at 9:13 pm | Permalink

    Why don’t we just ban fireworks, except professional displays

    Kids letting them off near me, apparently the shops have started selling them for November the 5th already

    Complete madness, and little the police can do about it

    Simple stuff like this should be sorted by the political class

  56. rose
    Posted August 25, 2019 at 12:03 am | Permalink

    Taxation should be for raising necessary revenue, not for social engineering. Only so much should be taken from people as is reasonable and that will not deter them from working or drive them abroad.

    Reform is urgently needed to simplify taxation. I think the last Chancellor to continue with that good work was Nigel Lawson – or was it Ken Clarke?

  57. Trevor Butler
    Posted August 25, 2019 at 6:32 am | Permalink

    I’m incredibly rich – I’m still healthy in my sixties – I have a wonderful wife who I have been married to for 39 years – I have 3 successful children and four amazing grandchildren….

    • a-tracy
      Posted August 28, 2019 at 2:42 pm | Permalink

      Very good point Trevor, congratulations.

  58. nhsgp
    Posted August 25, 2019 at 7:43 pm | Permalink

    Raise the state retirement age to 75.

    That’s a massive tax, particularly on the poor.

    Whilst you are at it, why not tax your own, funded, pension fund?

  • About John Redwood

    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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