Eat the rich, maaan, tax them all to Hell and gone. Go ahead. See what it gets ya.
The Treasury received £10.35 billion in income tax payments from those paying by self-assessment last month, a drop of £509 million compared with January 2011. Most other taxes produced higher revenues over the same period.
Senior sources said that the first official figures indicated that there had been “manoeuvring” by well-off Britons to avoid the new higher rate. The figures will add to pressure on the Coalition to drop the levy amid fears it is forcing entrepreneurs to relocate abroad.
The self-assessment returns from January, when most income tax is paid by the better-off, have been eagerly awaited by the Treasury and government ministers as they provide the first evidence of the success, or failure, of the 50p rate. It is the first year following the introduction of the 50p rate which had been expected to boost tax revenues from self-assessment by more than £1billion.
Only a statist idiot could be surprised by this. Which brings us to this:
Oopsie! It turns out that the wealthy can find ways to shelter income when government drives the cost of taxes high enough to make it worthwhile. If that means taking their money and going where the tax laws are more welcoming to investment, then this particular population has fewer barriers to making that solution work than most of the middle class. Instead of gaining more revenue, the UK will end up losing revenue, and not just from the sheltering — but also in lost economic growth as the wealthy have to put that capital to sleep rather than make it work in the economy.
Obama’s plan to hike capital-gains taxes to 20% and push a surtax on higher earnings will produce the same result here. The capital that might have gone to work in the US will go to work somewhere else or not at all, which will not just kill the direct revenues expected in static tax analysis from the hike, but also discard the revenues that would have occurred had the capital been put to work here. That’s the lesson from the British face-plant on surtaxes, and hopefully the US learns that lesson the easy way.
I wouldn’t hold my breath if I were you, Ed. You can drag a Lefty dumbass to the truth, but you can’t make him think.