Advertise with us
Read Magazine Self Publish Advertise
Send news Online ads Get Interviewed
EYES INTM Finance: News from the World's Innovative Creators & Their Masterpieces | Saturday, April 19, 2014
Sign up for our Newsletter!

All newsletter emails are double opt in, you must confirm your email or make a purchase to receive news from us, if you want to be removed from our mailing list please click the "unsubscribe" button on the email you received. (privacy policy)
Sign up for the Finance Newsletter



All newsletter emails are double opt in, you must confirm your email or make a purchase to receive news from us, if you want to be removed from our mailing list please click the "unsubscribe" button on the email you received. (privacy policy)

CANCEL YOUR NEWSLETTER SUBSCRIPTION.

(note: this will not cancel paid digital edition or advertising subscriptions.)

EMAIL:

50% Tax Rate Failing to Boost Revenues

UK- London | Feb 23 2012 | (01:04:03 - EDT)

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 “ maneuvering” 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 50% 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.

Advertise with us

Although the official statistics do not disclose how much money was paid at the 50p rate of tax, the figures indicate that it is falling short of the money the levy was expected to raise.

A Treasury source said the relatively poor revenues from self-assessment returns was partly down to highly-paid individuals arranging their affairs to avoid paying the 50p rate.

“It’s true that SA revenues are a bit disappointing — it’s still early, but it looks like there’s been quite a lot of forestalling and other manoeuvring to avoid the top rate,” said the source.

However, another Treasury source added that the tax deadline had been extended by two days because of industrial action at HM Revenue and Customs. Therefore, it was too early to begin assessing the revenues raised from the 50p rate of tax because about 20 per cent of self-assessment tax is paid in the hours before the deadline.

Francesca Lagerberg, head of tax at Grant Thornton, an accountancy firm, said: “My guess is that because the 50 per cent rate was flagged up in advance many taxpayers, particularly those with their own businesses, decided to extract dividends ahead of the change. It highlights the fact that high tax rates don’t always deliver high tax revenues.”

George Osborne, the Chancellor, is expected to receive a definitive analysis from the revenue on the 50p rate before next month’s Budget. The Liberal Democrats have insisted that it must stay because it is important to demonstrate that the rich are paying their fair share.

David Laws, a Lib Dem MP, has also suggested reducing tax relief on pensions for top earners.

The prospect of higher taxation on pensions comes as savers complain that low interest rates and quantitative easing have pushed down returns on savings and pensions.

Charlie Bean, the deputy governor of the Bank of England, last night insisted that those people should accept the pain as the price of restoring the wider economy to health.

The Confederation of British Industry, in its Budget submission today, urges ministers not introduce new levies on the rich, warning that the UK “will become a less attractive location for entrepreneurs and key employees”.

 

Share it:

Reactions

Leave a Reply

Archive:
Links:
  • Google search the internet giant
  • Wahooart museum Most famous Paintings of all time. Wahooart museum offers hand painted fine art reproductions.
Advertise with us
Advertisement- (place your ad here)
Valid CSS! Valid HTML 5.0 (experimental) Valid CSS!
Copyright © EYES IN™ Corp 2012. All Rights Reserved. | Contact us | Privacy Policy | Terms of use
Website by Redfish Creative