Budget 2007
Mar. 21st, 2007 02:42 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
ewx[Poll #951035]
My back-of-the-envelope calculation suggests that the break-even point is around £18,600: you win by about 2p on every pound you earn above that, and lose below it.
There are benefits changes at the bottom end which presumably ameliorate the doubling of 10% rate to some extent (e.g. working tax credit) but I'm afraid I don't know how those benefits work, so if you're affected by those you'll have to work it out yourself.
(no subject)
Date: 2007-03-21 05:39 pm (UTC)The consequence is a tax cut for somewhere around half the earning population. Obviously whether that's a "gain" depends on your point of view.
If you're selfish and in that half then the answer is clear; if you're trying to win the next election then the same might be true, depending on your analysis of voter behavior. Combined with the NI/40% alignment, fans of simple tax systems might think it a gain, though they should also consider that simplicity is not the only goal if they're not using "simplicity" as a socially acceptable code-word for "regressive".
I wonder how well a smoothly rising tax rate would work with no steps - for instance a linear growth from 0% to some maximum rate between two income levels - would work. Possibly only the mathematically inclined could love it.