The Very Meh Humza Yousaf Thread.

[Left Back]

2 minutes ago, Trogdor said:

I take it you are referring to comparing their tax in 23/24 to 24/25?

The divergence to an English taxpayer earning the £80k means c.£2,350 more income tax per year. That's significantly more than the £150 per annum and really should be the figure you quote when comparing especially when you cite house prices and tuition fees down south.

I don't really have much sympathy for those on £80k tbh. As I've said previously its those on £43k - £50k who are being hammered by the Scot Government's 'progressive' tax system.

I did some analysis on this earlier.  When you factor in the upcoming 2% reduction in NI it’s not until you start earning over £100k that you’ll be taking home less in April than you do today(ignoring the 3 months post Jan when you’ll be in net gain from the NI reduction).

The divergence is the stat that will be more widely used though.

[vikingTON]

40 minutes ago, Trogdor said:

I don't really have much sympathy for those on £80k tbh. As I've said previously its those on £43k - £50k who are being hammered by the Scot Government's 'progressive' tax system.

Can you identify a progressive system that doesn't tax objectively high earners to a significant degree? 

Once again, look at the actual median figures for full-time wages in Scotland. The only way that a progressive tax system to function is to tax groups who are well above the median at a higher rate than the actual average earner.

[Aufc]

2 hours ago, Caledonian1 said:

I had a quick look at Linkedin earlier - full of gammony tory greedy entitled p***ks - I really wish they would go ahead with their threats to move from Scotland now that they are paying around £150pa extra on their £80k salary - wait til they see house prices in England and have to pay for Uni, prescriptions, water bills and poorer services.

They would contribute more if they didnt use tax avoidance schemes and overseas bank accounts

Someone on 80k is not using tax avoidance schemes or overseas bank accounts unless you count putting into a pension as tax avoidance. What do you think would happen if all the higher rate tax payers left the country? 
 

I don’t mind paying a higher rate of rate with my salary. My point is purely based around the fact that there must come a point when you need to do something different. It’s not particularly sustainable for a country’s total income tax being so heavily reliant on such a small percentage of people. We need to be creating additional higher paying jobs and attracting additional highly skilled people and it will obviously be more difficult in a higher taxed situation.

59 minutes ago, virginton said:

Can you identify a progressive system that doesn't tax objectively high earners to a significant degree? 

Once again, look at the actual median figures for full-time wages in Scotland. The only way that a progressive tax system to function is to tax groups who are well above the median at a higher rate than the actual average earner.

As above, it’s so heavily reliant on a small number of people that it’s not sustainable 

[ICTChris]

16 minutes ago, Aufc said:

I don’t mind paying a higher rate of rate with my salary. My point is purely based around the fact that there must come a point when you need to do something different. It’s not particularly sustainable for a country’s total income tax being so heavily reliant on such a small percentage of people. We need to be creating additional higher paying jobs and attracting additional highly skilled people and it will obviously be more difficult in a higher taxed situation.

 

Not sure if this is just England and Wales or the whole UK but the top 1% of taxpayers pay 28% of all income tax.

[Trogdor]

2 hours ago, virginton said:

Can you identify a progressive system that doesn't tax objectively high earners to a significant degree? 

Once again, look at the actual median figures for full-time wages in Scotland. The only way that a progressive tax system to function is to tax groups who are well above the median at a higher rate than the actual average earner.

There is more to a progressive tax system than simply taxing higher earners more. You can lift the lowest earners out of tax as an example. The tax brackets/thresholds are important as thats where the progression in rate happens. On a purest point, you are correct a progressive tax system is ultimately about those who earn more paying more and those who earn less paying less.

I ignored your median salary point as it was only half of the equation and the point I was making. If you have a median salary graph over the years versus the higher rate threshold over the same period then I'd be interested to see it. The point is that salaries are growing (with inflation) and the tax thresholds have been left unmoved. In real terms, that simply increases the tax burden of that rump who have got stuck in the 'fiscal drag'. That group is very much those earning £43k to £50k.

More broadly, there are those who amass wealth whilst declaring very little income. The very people who designed the system to benefit themselves. Whilst the rest of us indulge in pointing fingers at ourselves - higher earners, pensioners, people on benefits (delete as appropriate), we aren't focusing on them.

Frankly, the whole tax system needs an overhaul not just council tax. Unfortunately, no political party will take that on though. The Scottish Government couldn't if they wanted to as they have limited powers over taxation.

Edited December 20, 2023 by Trogdor

[Trogdor]

3 hours ago, Leith Green said:

Genuine question - do you think this will change for the better under a new govt?

Presumably Labour, when they get in, will want to introduce tuition fees to "bring Scotland in line" with rUK?

Obviously this will bring in far more £££ to the individual Universities than they presently get from the Scot Govt - but the flipside is that many of our young people are then saddled with a large student debt for decades - or life*

*I await the first smartarse who comes along and says "aye, but xyz% of them will never repay that debt".

The reality is that HE funding is a trainwreck south of the border as well.

Charging fees for RUK students hasn't solved the problem down south. About a third of institutions run at a deficit. Broadly, almost a fifth (it varies institution to institution) of students are International students (who are unregulated so you can charge them exorbitant amounts) and it's not financially sustainable either. International students have been cross subsidising the rest of the institution's activities and students for a long while.

It's not helped by our right wing UK Government making this a less attractive country to come too wrt. environment and also making visas harder to attain for students. 

Something has to give soon, if international students numbers were to take a downward turn there will be mass redundancies and Universities down sizing or failing entirely.

It's a complex equation tbh. I don't envy either government.

[vikingTON]

1 hour ago, Trogdor said:

There is more to a progressive tax system than simply taxing higher earners more. You can lift the lowest earners out of tax as an example. The tax brackets/thresholds are important as thats where the progression in rate happens. On a purest point, you are correct a progressive tax system is ultimately about those who earn more paying more and those who earn less paying less.

I ignored your median salary point as it was only half of the equation and the point I was making. If you have a median salary graph over the years versus the higher rate threshold over the same period then I'd be interested to see it. The point is that salaries are growing (with inflation) and the tax thresholds have been left unmoved. In real terms, that simply increases the tax burden of that rump who have got stuck in the 'fiscal drag'. That group is very much those earning £43k to £50k.

1) Not all salaries are growing, and not at the same rate.

2) Being in a higher tax bracket over the whole year doesn't mean that you suddenly pay an astronomically higher tax sum than before. It's an increased cut of the marginal additional wage that you exceed the threshold only. So they're not actually being 'taxed at 42%' - it's still an actual tax rate of about 15% of earned income. 

The volume of tears and snotters about wealthy white collar professionals suddenly paying a higher rate of tax%!!!!111!!! on a grand or two of additional income - that many have just extracted from the SG at public expense - is utterly out of proportion to its consequences. It's special pleading by a middle class who think that they are the entire country. 

[Frankie S]

7 hours ago, Caledonian1 said:

I had a quick look at Linkedin earlier - full of gammony tory greedy entitled p***ks - I really wish they would go ahead with their threats to move from Scotland now that they are paying around £150pa extra on their £80k salary - wait til they see house prices in England and have to pay for Uni, prescriptions, water bills and poorer services.

They would contribute more if they didnt use tax avoidance schemes and overseas bank accounts

My wife is a part-time hairdresser and, due to the higher tax threshold having been frozen for several years, is now a higher rate taxpayer. She’s obviously not pleading poverty, but she’d be greatly amused by the suggestion that she’s just been admitted to an elite cabal of tax avoiders and overseas bank account users. 

Quote

Wait til they see the house prices in England

Yeah, London apart, they’re much cheaper than Edinburgh house prices, that’s for sure. As ever, it’s all relative. 43.6k might represent a princely sum elsewhere, but in Edinburgh it barely gets you on the housing ladder these days.

[ICTChris]

5 hours ago, Frankie S said:

My wife is a part-time hairdresser and, due to the higher tax threshold having been frozen for several years, is now a higher rate taxpayer. She’s obviously not pleading poverty, but she’d be greatly amused by the suggestion that she’s just been admitted to an elite cabal of tax avoiders and overseas bank account users. 

 

By 2028 a quarter of teachers will be higher rate taxpayers, as well as one in eight nurses. By that year one in five UK taxpayers will be on the higher rate, compared with around one in thirty in the early or mid 1990s.

[Aufc]

9 hours ago, virginton said:

1) Not all salaries are growing, and not at the same rate.

2) Being in a higher tax bracket over the whole year doesn't mean that you suddenly pay an astronomically higher tax sum than before. It's an increased cut of the marginal additional wage that you exceed the threshold only. So they're not actually being 'taxed at 42%' - it's still an actual tax rate of about 15% of earned income. 

The volume of tears and snotters about wealthy white collar professionals suddenly paying a higher rate of tax%!!!!111!!! on a grand or two of additional income - that many have just extracted from the SG at public expense - is utterly out of proportion to its consequences. It's special pleading by a middle class who think that they are the entire country. 

You would make a good politician. From everyone I have spoken to, no one is moaning at the fact they have to pay more tax. Everyone is just questioning the current income tax model in Scotland. The focus seems to be on redistributing wealth rather than creating it. 
 

Edited to add. The reality is that the majority of people affected won’t move to England over this. There may be some people who work in England but live in Scotland who may move. However, there will be some people who have variable hours who will reduce their hours because they don’t see the benefit of doing the additional hours. This will have negative impact on the economy. There will be doctors who will reduce the amount of of NHS work they do and either move to the more lucrative private work where they can pay less tax via a company. This will hit services. Also, as mentioned, people wil just pay more into their pension and offset any rise. 

Edited December 21, 2023 by Aufc

[scottsdad]

14 hours ago, Leith Green said:

Genuine question - do you think this will change for the better under a new govt?

Presumably Labour, when they get in, will want to introduce tuition fees to "bring Scotland in line" with rUK?

Obviously this will bring in far more £££ to the individual Universities than they presently get from the Scot Govt - but the flipside is that many of our young people are then saddled with a large student debt for decades - or life*

 

*I await the first smartarse who comes along and says "aye, but xyz% of them will never repay that debt".

I really don't know. Years of austerity have taken their toll on the unis themselves, and in principal I agree that it should be free. 

Don't know what the answer is. 

[TheScarf]

I think it's a fantastic budget from the Scottish National Party. 

[vikingTON]

1 hour ago, Aufc said:

You would make a good politician. From everyone I have spoken to, no one is moaning at the fact they have to pay more tax. Everyone is just questioning the current income tax model in Scotland. The focus seems to be on redistributing wealth rather than creating it. 
 

Edited to add. The reality is that the majority of people affected won’t move to England over this. There may be some people who work in England but live in Scotland who may move. However, there will be some people who have variable hours who will reduce their hours because they don’t see the benefit of doing the additional hours. This will have negative impact on the economy. There will be doctors who will reduce the amount of of NHS work they do and either move to the more lucrative private work where they can pay less tax via a company. This will hit services. Also, as mentioned, people wil just pay more into their pension and offset any rise. 

There are plenty of people who are indeed moaning about paying higher rates of tax. This thread and the media coverage is full with tears and snotters about the idea that teachers and (senior) nurses might have to pay more tax on a tiny fraction of their annual income.

The irony of course being that of the teachers and certain other white collar unions hadn't extracted high pay rises from the SG in the face of reality, then there wouldn't be a significant budget shortfall and they wouldn't qualify for the 42% bracket at all. For those special pleaders, it's simply a case of chickens coming home to roost. 

As for reducing working hours and increasing pension contributions - there are very few positions where that would be a negative. You're right that behavioural may reduce the tax revenue generated - although a competent government should account for those changes in its calculations. It's a country where burnout and piss-poor retirement saving is the norm though. 

[Caledonian1]

8 hours ago, Frankie S said:

My wife is a part-time hairdresser and, due to the higher tax threshold having been frozen for several years, is now a higher rate taxpayer. She’s obviously not pleading poverty, but she’d be greatly amused by the suggestion that she’s just been admitted to an elite cabal of tax avoiders and overseas bank account users. 

Yeah, London apart, they’re much cheaper than Edinburgh house prices, that’s for sure. As ever, it’s all relative. 43.6k might represent a princely sum elsewhere, but in Edinburgh it barely gets you on the housing ladder these days.

I am more getting at those complaining about the new tax band that kicks in at £75k and higher rate tax payers at £125k.  Predictably I see some of the right wing "Scottish" papers today have headlines about people in the financial services industry moving to England because of higher taxes in Scotland - however, there are never examples given and I am not convinced people move house to save a few hundred pounds or at most two or three thousand for the £125k tax payers. 

All very reminiscent of a certainly Michelle Mone going to the paers anytime the SNP won an election saying she would move to England - she did eventually move to the Isle of Man but that was not to avoid the SNP rather the HMRC.  I wonder whatever happened to her?  I am not going to lie if I suddenly came upon a £60m windfall I may just be tempted to buy an overseas holiday home myself......but would pay my tax dues in Scotland and suspect I may have enough left over to live a decent life.

[Trogdor]

14 hours ago, virginton said:

1) Not all salaries are growing, and not at the same rate.

2) Being in a higher tax bracket over the whole year doesn't mean that you suddenly pay an astronomically higher tax sum than before. It's an increased cut of the marginal additional wage that you exceed the threshold only. So they're not actually being 'taxed at 42%' - it's still an actual tax rate of about 15% of earned income. 

If you look at the 42% income tax threshold (formerly 41% and 40%) it was £43,000 in 2016/17 when it was devolved and its now £43,663 some 8/9 years later. A 1.5% increase in that period of time.

Pay increases over that period (irrespective of private or public sector) have been well in excess of that. It is not just the recent pay awards won in the public sector. If I use the median ASHE figures you shared as a proxy, median pay has increased by c.30% over that time period.

The effect of this is that roles which were never higher rate tax payers (like teachers and senior nurses) now are. I don't think that is fair to be honest. You do. Fair enough.

I think one of the reasons for exorbitant pay claims is that Unions are working out for every £1 gained how much is being lost in tax. As such they are asking for more so their members take home more. It is a vicious cycle in that regard.

What would I do? I would be in favour of a new upper rate like 31.5% (half way between the intermediate and higher rate) kicking in at £43,663 to £50,000. Not that it matters as the Government won't do that though as it'll cost them.  It'll also result in finger pointing at 'higher' earners getting a tax reduction. At a minimum, the thresholds should be moving up each year. Holding them static is not sustainable as everyone in work would be a higher rate tax payer eventually. Perhaps that's the grand design? I doubt the SG has that foresight though.

Edited December 21, 2023 by Trogdor

[vikingTON]

Not against an intermediate tax band, but then one of the points of opposition to the existing budget is that the tax bands are adding to much complexity to the system. 

If public sector unions like the EIS seriously believe that their employees should be uniquely shielded from tax rises - despite being paid entirely out of tax receipts - then they're even more stupid than I already thought. 

[Binos]

5 hours ago, Caledonian1 said:

I am more getting at those complaining about the new tax band that kicks in at £75k and higher rate tax payers at £125k.  Predictably I see some of the right wing "Scottish" papers today have headlines about people in the financial services industry moving to England because of higher taxes in Scotland - however, there are never examples given and I am not convinced people move house to save a few hundred pounds or at most two or three thousand for the £125k tax payers. 

All very reminiscent of a certainly Michelle Mone going to the paers anytime the SNP won an election saying she would move to England - she did eventually move to the Isle of Man but that was not to avoid the SNP rather the HMRC.  I wonder whatever happened to her?  I am not going to lie if I suddenly came upon a £60m windfall I may just be tempted to buy an overseas holiday home myself......but would pay my tax dues in Scotland and suspect I may have enough left over to live a decent life.

But she's only going to see any benefit of that money if her husband dies

[Binos]

7 hours ago, Aufc said:

You would make a good politician. From everyone I have spoken to, no one is moaning at the fact they have to pay more tax. Everyone is just questioning the current income tax model in Scotland. The focus seems to be on redistributing wealth rather than creating it. 
 

Edited to add. The reality is that the majority of people affected won’t move to England over this. There may be some people who work in England but live in Scotland who may move. However, there will be some people who have variable hours who will reduce their hours because they don’t see the benefit of doing the additional hours. This will have negative impact on the economy. There will be doctors who will reduce the amount of of NHS work they do and either move to the more lucrative private work where they can pay less tax via a company. This will hit services. Also, as mentioned, people wil just pay more into their pension and offset any rise. 

You need levers to create wealth 

As the Irish have shown 

[ICTChris]

Do the Scottish government have the power to change the thresholds?  I think they do but I'm not sure.

The Westminister government are freezing the tax thresholds, so the same impact will be felt across the UK.  In my extensive Googling research for this, I was reading a piece by the Institute for Fiscal Studies, who said that this is in effect, one of the biggest tax rises in British history.  

[Leith Green]

5 minutes ago, ICTChris said:

Do the Scottish government have the power to change the thresholds?  I think they do but I'm not sure.

The Westminister government are freezing the tax thresholds, so the same impact will be felt across the UK.  In my extensive Googling research for this, I was reading a piece by the Institute for Fiscal Studies, who said that this is in effect, one of the biggest tax rises in British history.  

Aye, but wee dougie ross thinks all the "top people" will be fleeing down there.............

We heard exactly the same from this simpleton when Truss mooted some big changes down there (disastrously, as it happens), and fuckall happened.

I will eat a huge slice of humble pie if anyone can show me stats that confirm more than a handful of eejits actually leave.