Responding to a suggestion by Unison that council tax (in Scotland) be made more proportionate to market values, Numpty at 20 has this to say:
So a single millionaire in a one bedroom flat will pay less than a family of 5, on average income, in a four bedroom house?
a) Council Tax is a tax on consumption of housing, in the same way as duty on booze and fags is a tax on consumption of booze and fags. Would anybody in their right mind advance the argument that a teetotal nonsmoking millionaire pays less booze and fags tax than a normal household?
b) Our millionaire is currently paying over £500,000 income tax/NIC/VAT a year, and maybe £1,000 Council Tax. The family of 5 on average income is probably paying less than £10,000 income tax/NIC/VAT (once you minus off Tax Credits etc) plus (say) £1,500 Council Tax.
Even if you doubled Council Tax, I fail to see how the millionaire can in any way be described as "paying less tax" overall than the family.
Monday 7 February 2011
The New Maths
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17 comments:
Council Tax is already massively "progressive" in that the people who actually pay Council Tax are generally those who don't use the bulk of the local services.
In London (in particular) a very large proportion of the population pay no Council Tax and also consume the expensive services, leaving childless professionals to pay massively over the odds to have their bins collected.
Taxing houses in proprtion to size creates a perverse incentive to build smaller houses.
For clarity, that is to build all houses smaller.
BE, maybe so, but is that an argument for increasing it or reducing it? It also depends whether the 'young professionals' live in a flat or a huge house, doesn't it?
Den, three decades of NIMBYism have led to only very small houses being built, that's where the problem is. With LVT there probably wouldn't be much new construction at all for a few decades while people shuffle up or down into an appropriately sized house.
how would you like to be shuffled up or down into 'an appropriately sized house' having paid for said home in the first place and then paying the attending taxes for 50+ years?
who determines what is appropriate?
you?
or the person/people to be 'shuffled' out of area, away from family and friends and familiarity at the most vulnerable time in life?
Like BE, I also am a childless professional living in London. I just happen to share a two bed house with the cat. I'm sure the likes of Moonbat would have me shot. That said, however, the ONLY council services I "consume" is having the bins emptied and having the protection of the police and fire services if needed. However, my neighbours (a pregnent couple on the left, and a family of four on the right) theoretically pay exactly the same council tax as me, granted I get a discount. But does that discount accurately reflect how much less I consume critical frontline services such as personal well-being trainers? I would argue not.
The size of the footprint of the house bears no relation to the amount of council services consumed - it is rather the amount of people occupying said footprint that costs the money.
Anon1
1. Most people who bought more than ten years ago have effectively paid a negative amount for their house.
2. Sure, people paid far too much income tax in the past - but is that an argument for making people pay far too much income tax in the future as well? Two wrongs don't make a right.
3. "Who decides what is appropriate?" The person paying the tax of course. You might as well ask "who determines what is an appropriate car for any household" and the answer is that each household decides for itself.
4. As to this 'shuffling out of the area' are you mad? Are there not large and small homes in any area? And there'd always be a roll-up option for pensioners.
Anon2: you've obviously fallen for The Big Lie that all local services are miraculously paid for out of council tax (5% of total taxes). Where do you think all the other taxes go (95% of the total)?
"So a single millionaire in a one bedroom flat will pay less than a family of 5, on average income, in a four bedroom house?"
I would also add that I would find it highly unlikely that the "1 bedroom flat" this theoretical millionaire is living in is going to be some pokey little shit hole like here up north and they will more than likely still be paying a pretty penny in LVT as a result of the massive location value.
How many millionaires live in dumps & how many live in nice areas in expensive houses/apartments? A family on average income is significantly more likely to also be living in an average priced house and as the Scottish Greens pointed out in their research paper on LVT houses in bands A-D would be better off and in band E only a very minor amount worse off (less than a 1% increase on council tax) Your "average 4 bed house" is probably a band C or D
SW, you remember that old saying that men are at a disadvantage in an argument because they get bogged down in 'facts' and 'logic'? That's the same problem that the likes of thee and me are facing when arguing with the HO-ists.
I particularly like the way they completely contradict themselves:
a) LVT is an attack on wealth and hence neo-Communist.
b) LVT is an attack on families and so deeply neo-Liberal (in the negative meaning of that expresssion).
but are capable of expressing both thoughts simultaneously without noticing.
Envy is such an ugly justification for an economic view, but in the past 13 years it has become an acceptable one, however nonsensical the point put forward.
anon 1 responding to MW.
you say
1. Most people who bought more than ten years ago have effectively paid a negative amount for their house.
so....? a house can be more than mere equity. imho, it should be a 'home'. a base for family and friends over decades.
2. i don't know why you thought i was talking about income tax. i was talking about taxes attendant to owning a home. i pay more in council tax per week than i do on the basics of living. council tax as it stands is a millstone around the necks of people who regard their house as their home, not an investment.
3. You seemed to be suggesting that when children have flown the nest, private homeowners should be encouraged to leave their family home and its memories for an 'appropriately sized' dwelling'.
4. I'm not mad. How dare you!....well, maybe a little!
Anon "2. i don't know why you thought i was talking about income tax. i was talking about taxes attendant to owning a home. i pay more in council tax per week than i do on the basics of living. council tax as it stands is a millstone around the necks of people who regard their house as their home, not an investment."
I don't understand how council tax is a 'millstone around the neck' when its a fixed amount. If council tax changes were implemented so that the amount were a percentage of the valuation with no caps or collars such as the current highest band not being able to go above 3x lowest band and we then reduced other taxes on incomes based on Enron Economics (if we currently get £x based on a total population income of £y then the cost is the % reduction multiplied by y. In reality the tax collected would of course be more than this but that's because this method of calculation is complete bullshit and is why soak the rich tax policy cannot work.
Anyway onto the point, if I have to pay a bit more tax based on the value of my home but as a consequence pay a lower percentage on any income increase, the incentive to put in the effort to earn a pay rise or to take a second job is drastically increased as you get to keep more of what you earn. High income taxes are bad.
Anon,
1. "I regard it as a home and not an investment" is traditional Home-Owner-Ist cant, isn't it?
2. Most people pay ten times as much in income tax, National Insurance and VAT as they pay in council tax. Are you one of these people who thinks that their' home' is worth more than the efforts of the people who live in it?
3. I'm not 'suggesting' anything. I'm setting out the simple fact that it is insane for granny to live on her own in a three-bed and for people in their twenties to be stuck living with their parents, and if they manage to 'get on the property ladder', the most they can afford is a one bed flat.
Is it so terrible for the extended family to pool its income and resources and for granny to give the adult grandchildren her three-bed semi so they can start a family, and in return these people buy a one-bed flat for her?
If they want 'the home to stay in the family', then it can, FFS.
4. You are mad. Do you imagine that people's 'memories' are erased if they move home? Can she not take her family photos, favourite furniture and books with her? Do relatives stop visiting her because she has moved from a three-bed semi to a nearby flat?
This brings us neatly back to my reply 1 and 2: do people really value their homes above themselves and their 'social network'?
I've moved home within a five mile radius more often than I care to remember, I still have the same wife and kids, the same CDs, books, photos, the same friends, the same job.
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SW, keep up the good work!
A minor point (but it's a trick used by lefties, so I thought I'd make it):
A millionaire is not someone who earns a million pounds a year.
That millionaire could have the hope diamond in his pocket and be living in a single bed flat. Recognising that his income is zero (and yet wanting to keep his diamond) he chooses to consume considerably less housing than high earners do. Why then shouldn't he pay less council tax?
"I've moved home within a five mile radius more often than I care to remember, I still have the same wife and kids, the same CDs, books, photos, the same friends, the same job."
I've stayed in the same house for the last 20 years. But I've added to my CD/book collections, got a better job, made lots of new friends and traded in the wife for a new one a couple of times!
OP, when I was a lad, 'millionaire' meant what you says it means, but nowadays it means 'earning more than a million a year'.
Either way, the point is that if the [high income hate figure in a small, cheap flat] earns £50,000 and the 'hard working family' [in an average house] earns £25,000, then the [high income hate figure] would still be paying two or three times as much in total tax as the 'hard working family' (income tax and council tax) even if council tax were made proportional to house values.
Bruce, how did you manage to trade in wives but keep the house? That's a feat which few blokes manage!
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