Comment by mickgardner
18 days ago
Does London need the Global Rich hanging around if they’re not willing to pay taxes? Is it necessary to have the tax bring in 30 Billion in order for it to be considered a success? If nothing else, this tax demonstrates to those who DO pay tax, that the Government is willing to treat earners equally and fairly, regardless of how much tax it brings in.
They do pay taxes though. Non domiciled are roughly 0.11% of UK residents and pay about 1.24% of UK taxes. This change is likely to lower tax revenues.
> Non domiciled are roughly 0.11% of UK residents and pay about 1.24% of UK taxes
It's curious that the percentages used to defend not taxing the rich (whether they are UK citizens, or operating as "non-doms") tend to be what percentage of the tax burden they pay. But it's never what percentage of their income and capital gains they pay as tax.
I think the latter is a fairer representation, considering we have a progressive taxation system. Someone who is earning over £125k a year should be paying close to 45% of their income and capital gains.
The question is: are they? If not, why not?
The world has to be dealt with how it is. For example:
>The question is: are they? If not, why not?
Because they're non-domiciled and for several centuries the UK didn't tax foreign income of non domiciled residents. It's not a mystery, it was the law.
The non-dom's came to the UK because of this tax regime. The UK can either have the revenue they get from them, which is substantial. Or, it can remove the non-dom regime, hope they stay, but be prepared for total loss of their revenue if they leave.
There's no magical third choice where everyone in that non-dom category stays just cause and pays more money. So far it looks like UK tax revenues are set to diminish from this change.
If they're here they tend to spend money, and employ people. That all ends up as tax slightly more indirectly.
So what you are saying is, it eventually trickles down?
edit: The reality is they don't spend enough for it to offset the harms that wealth inequality brings.
I know a couple of people who have been using this London loophole as a way to avoid paying taxes anywhere at all. They are not residents here, they are not residents there, and their income is earnt globally. So they think they shouldn't have to pay tax to any particular country.
>edit: The reality is they don't spend enough for it to offset the harms that wealth inequality brings.
source? Has "the harms that wealth inequality brings" even been quantified?
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Are they? Or are they there to outcompete ordinary people for houses, labour, etc?
We don't need a bigger market for luxury dog sitters or sports car manufacturing, better allocate those resources for childcare, elder care, or other chronically understaffed fields.
That's just arguing trickle down economics, which has a decades long story of failure.
>That's just arguing trickle down economics, which has a decades long story of failure.
Deng Xiaoping's "let some people get rich first" worked out pretty well.
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Likely you’ve been flagged because everyone on hackernews refuses to see themselves as working class and think that we’re the global elite that needs protecting.
“Failure” is of course subjective, but I would say that the gargantuan increase in wealth inequality is a datapoint in favour of suggesting that its a failed model.
Post-War consensus Britain was a golden age, and neoliberalism has been harmful to the quality of life for an overwhelming number of British people. This is just factual, by all the data we have.
They don’t need to be there to employ people, and they don’t spend as much as most people do as a portion of their income or wealth.
I'm not claiming they pay as much tax or spend as much as percentage; but they do spend money in the country; it might not be a fair amount etc - but it's a useful amount going into the pot. So if you emphasise fairness they leave and you have less tax to spend on the poor. As long as they're not actively doing bad things, I'd rather have the cash coming into the country.
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And if they just pay tax like everyone else, even more tax!
slightly more indirect, with more loopholes with more of the cash exiting the cash flow cycle, choking the life out of the economy.
There are plenty of people with money, who do pay taxes, who can start those businesses. We don’t need trickle down economics in order to function as a society.
I employ people and I am not a billionaire. I also pay my taxes. Crazy I know.
Would you still pay if you knew for certain you'd get away with it? If yes, why, or why not?
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"slightly more indirectly" is an interesting way to say "by distorting local economies and politics around the idiosyncratic needs and desires of a very small number of uber-wealthy foreigners."
According to the article, there was one person who was hiring over 100 people to take care of their needs. That person is now leaving the UK.