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National Insurance

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    #11
    Originally posted by TykeMerc View Post
    Of course as we know if employers are paying more in the tax laughably called National Insurance then there's less money to pay their existing employees or hire additional ones. That will do a lot of good for the economic recovery!!!
    Precisely.

    Comment


      #12
      Originally posted by AtW View Post
      What's really suprising (or not) is how you use statistics for 09/10 clearly marked as forecasts - more importantly you are picking on last year in this list knowing full well that income tax will be depressed due to "the rich" not paying as much with NI broadly staying the same or even going down if you compare it with 07/08.
      OK, let's ignore the last couple of years.

      Year...........Income Tax (£Bn)........National Insurance (£Bn)
      2001/2...............108.............................63
      2007/8...............147............................100
      % increase..........36%.........................59%

      NI has still gone up 1.6 times faster than Income Tax.

      If you think an NI/Tax ratio going from 60% to 70% paints a more realistic picture then you're obviously easily fooled.

      Comment


        #13
        Originally posted by DonkeyRhubarb View Post
        NI has still gone up 1.6 times faster than Income Tax.
        No, it hadn't: it went up 1.6 times from the initial amount (63 bln), where as income tax receipts gone up 1.36 times.

        How much more 1.6 than 1.36? Well, 1.6 is 1.16 times more than 1.36 or 16% if you like, that's the real increase - if you look at my numbers that I posted (60% vs 70%) then they illustrate this point much more accurately. Frankly if salaries actually increase 3-4% per year, then one would reasonably expect tax take to easily go over 36% for 10 year period.

        I guess doing it the right way won't give you the Daily Mail sensationalist number.

        Since NIC had lower base to begin with so relative increase would be higher, especially given that NIC were actually increased where as income was the same (until 50% band kicks in).

        If you care about relative numbers then I'd recommend whining about doubling of tax on ciders or air passenger duty increases.

        ---

        I just want to ask you one simple question now - how much less in relative terms people who got into BN66 paid in income tax and presumably NI?

        Let me guess here - "The arrangement saved Mr Huitson £84,980 in income tax over seven years, effectively cutting his tax rate to just 3.5 per cent." (source: CyberToryGraph) - if 3.5% effective tax rate when it should have been 40%+ then reduction is 1000% or even more.

        Given that you are in my view in no position to whine about relative tax increases, but if you do then please at least use correct calculations, which in this case would be that NIC receipts went up 16% faster over 10 years than income tax receipts. That's hardly a disaster even though NICs should have been just called what they are - income tax on middle classes.

        Comment


          #14
          Originally posted by AtW View Post
          No, it hadn't: it went up 1.6 times from the initial amount (63 bln), where as income tax receipts gone up 1.36 times.

          How much more 1.6 than 1.36? Well, 1.6 is 1.16 times more than 1.36 or 16% if you like, that's the real increase - if you look at my numbers that I posted (60% vs 70%) then they illustrate this point much more accurately. Frankly if salaries actually increase 3-4% per year, then one would reasonably expect tax take to easily go over 36% for 10 year period.

          I guess doing it the right way won't give you the Daily Mail sensationalist number.

          Since NIC had lower base to begin with so relative increase would be higher, especially given that NIC were actually increased where as income was the same (until 50% band kicks in).

          If you care about relative numbers then I'd recommend whining about doubling of tax on ciders or air passenger duty increases.

          ---

          I just want to ask you one simple question now - how much less in relative terms people who got into BN66 paid in income tax and presumably NI?

          Let me guess here - "The arrangement saved Mr Huitson £84,980 in income tax over seven years, effectively cutting his tax rate to just 3.5 per cent." (source: CyberToryGraph) - if 3.5% effective tax rate when it should have been 40%+ then reduction is 1000% or even more.

          Given that you are in my view in no position to whine about relative tax increases, but if you do then please at least use correct calculations, which in this case would be that NIC receipts went up 16% faster over 10 years than income tax receipts. That's hardly a disaster even though NICs should have been just called what they are - income tax on middle classes.


          Who left themselves logged in as AtW? The writing style is completely different... far more complex sentence structures.
          Originally posted by MaryPoppins
          I'd still not breastfeed a nazi
          Originally posted by vetran
          Urine is quite nourishing

          Comment


            #15
            AtW it's hardly a mystery that you have absolutely no sympathy with the BN66 people, but does that really justify you attacking DonkeyRhubarb like this?

            The point he's made about NI applies to every employee and employer and is an illustration of how our wonderful Government has slipped in an effective increase in the Income Tax rate by stealth which has attracted no real controversy. NI applies to everyone paid a salary over the NI threshold irrespective of class so it's not even a "middle class" tax...

            Comment


              #16
              Originally posted by TykeMerc View Post
              The point he's made about NI applies to every employee and employer and is an illustration of how our wonderful Government has slipped in an effective increase in the Income Tax rate by stealth
              First of all NICs are not a stealth tax - they are taken at the source and every employee can see increase in amount of tax they paid. Now increasing Employer NIC only can be deemed as stealth when it comes to employees some of whom won't have a clue that employer also pays extra tax on top.

              Mr DonkeyRhubarb made obvious to a half educated person mistake in making claim that relative rate of increase in NICs over increase in Income Tax is much higher than it is - in reality it is around 16% over 10 years, rather than claimed 60%. Hardly surprising since NICs were increased many years ago.

              You don't like my "attack" on Mr DonkeyRhubarb? It's not an attack - I merely point out to his obvious to me hypocrisy in whining (incorrectly!) about relative increase in taxes despite allegedly taking part in a scheme (or otherwise supporting it) that according to source I posted above allows far more massive reduction in the same income tax paid!

              This is relevant because when you got people taking part in such schemes that reduce income tax to near 0, then inevitably someone would need to pay for it.
              Last edited by AtW; 2 April 2010, 18:16.

              Comment


                #17
                Originally posted by AtW View Post
                Mr DonkeyRhubarb made obvious to a half educated person mistake in making claim that relative rate of increase in NICs over increase in Income Tax is much higher than it is - in reality it is around 16% over 10 years, rather than claimed 60%. Hardly surprising since NICs were increased many years ago.
                I'm probably wasting my time here but what the hell.

                Tax increased by 36%.
                NI increased by 59%.

                You say the relative difference is 16%, ie. NI has gone up 16% faster than Tax.

                I stand by the 60% (actually 63.88% to be precise) and hopefully an illustration might convince you.

                Example

                Fred and Bob earn £10k p.a.

                Fred gets a 59% payrise, increasing his salary to £15,900.

                Bob gets a 36% payrise, increasing his salary to £13,600.

                How big was Fred's payrise relative to Bob's payrise?

                16%? I don't think Bob would see it like that.

                No, the relative difference between the pay rises was 5,900/3,600.

                Fred's payrise was 63.88% more than Bob's.

                QED.
                Last edited by DonkeyRhubarb; 2 April 2010, 18:58.

                Comment


                  #18
                  Your example is flawed because you assume same base of salaries (£10k) as well as introducing Daily Mail like factors of evaluation "what Bob sees" - starting Income tax and NIC numbers had different starting bases, in case you did not notice.

                  Originally posted by DonkeyRhubarb View Post
                  I don't think Bob would see it like that.
                  I could not care less how Bob sees it - for all I know he did not get proper education in school and can't comprehend relative numbers.

                  The matter of fact is that your number (60%) is completely wrong when applied to relative increase of NIC over long period of time when compared with increase in income tax over same period: it simply isn't 60% because income tax increased by 36% as well.

                  I guess I am wasting time with you as well - if you can stand up in court with straight face and argue that 3.5% effective tax via BN66 scheme is acceptable, then I guess your current argument is a no brainer in your world: it does not make it right though.

                  Comment


                    #19
                    I am going to ignore AtW's incessant rant against his favourite BN66 scheme since it is not relevant at all to this topic.

                    In fact OP is correct in what he is trying to convey. NI is a tax that is collected for the purposes of providing healthcare and state pensions mainly. Now, Labour has jacked up the NHS bill quite considerably by employing thousands of unnecessary managers. Therefore, NI has to increase to pay for this. Regarding state pension, despite what a lot of people think, its unfunded. Your NI contribution should ideally go into a pension fund from which you should then receieve your pensions in the future. But sadly the current NI contributions are used to pay off the current state pension.

                    Now when the government wants to extract more cash from the taxpayer it is so much easier for them to just increase the NI rather than income tax. Increasing the income tax is not voter friendly and the general public tend to get angry at any thought of increase of income tax. So income tax rates remain the same or increase by a small margin whereas NI is jacked up as much as possible.
                    Vote Corbyn ! Save this country !

                    Comment


                      #20
                      Originally posted by AtW View Post
                      The matter of fact is that your number (60%) is completely wrong when applied to relative increase of NIC over long period of time when compared with increase in income tax over same period: it simply isn't 60% because income tax increased by 36% as well.
                      One last go.

                      Income tax increased by 36%.
                      NIC increased by 59%.

                      The relative rate of increase is not 1.59/1.36 (16.9%).

                      It is 0.59/0.36 (63.8%).

                      You can argue that I was wrong to use the BN66 scheme and to continue fighting the legislation, but I'll stand by my maths.
                      Last edited by DonkeyRhubarb; 2 April 2010, 19:42.

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