Someone earning £20,000 with a full personal allowance has an effective tax rate of around 9% on all their income. Someone earning £50,000 has an effective tax rate of 18.4%. The most a higher rate taxpayer with an income up to £100,000, and full personal allowance, will have is an effective rate of c. 29%. Obviously there's also National Insurance, but that's 2% for higher rate taxpayers.
Yes, relative to our level of government spending. Post-war British economics have been characterised by a boom-and-bust cycle of unfunded public spending commitments and subsequent austerity. A relatively minor increase in total taxation could provide vital long-term stability.
The UK's total tax revenue is 39% of GDP. This is considerably higher than the EU average of 35.7%, but lower than Germany, France and the Nordic countries. Increasing our overall taxation to match Germany (40.6%) would provide an additional 31bn in revenue; Matching France (44.6%) would provide an additional £109bn.
The alternative is that we accept a reduced level of public services. Osborne has already trimmed every last scrap of fat in the public finances, so further cuts will be increasingly painful.
The real question is, 'are interest rates to low?'
I have two savings / ISAs whatever you want to call them at 2% and 1.5% respectively and even with thousands in them I make less than one hundred quid a year.
I left uni in my overdraft and worked a shit paying job to get out of it.
Now I have a proper job that pays bonuses/generous expenses and I'm just trying to establish some amount of decent savings that I can fall back on should I need to as an emergency back up.
That and I'm financially illiterate. I wouldn't know what to invest in that isn't property but I doubt I have enough for that.
>>6210 I'm not the one stating it's significant enough to be included.
The median graduate starting salary in 2014/15 was £28,000, according to the Association of Graduate Recruiters. If 9% is paid on amounts over £21,000 then that amounts to £630, 2.25% of their overall salary. When you factor in the number of people paying this then it amounts to the square root of fuck all.
Get a Santander 123 and (with 500 quid going in and 2 direct debits) you can earn 3% on up to 20k (with a 5 quid / month fee). I have one with almost 20k in, and my calculations indicate I will earn 540 quid a year in interest (tax free for most, too).
>>6212 True, but you said it yourself - £28k is the mean starting salary. It might not be a significant source of revenue currently but it will be in 10 years time when more people have graduated under the new scheme and are earning significantly more than when they started work.
Student loans are moot. The money has already been paid out in the form of fees and living costs. The repayment schedule is calibrated to recoup those costs, so the government won't gain any real revenue. Many projections suggest that there'll be a considerable shortfall, so the student loans system may need to be subsidised by general taxation.
>>6212 That would be for a narrow definition of "median graduate staying salary", namely for people entering the specific programmes they recruit into.
