Is this actually workable?
Oct. 10th, 2007 02:59 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
sobriqueI was thinking, that taxation and benefits is a complicated and convoluted subject.
The difficulty of balancing relaiming enough money that essential stuff can be done, and especially funding things like benefits, but at the same time allowing people to keep enough of their pay, that they can actually a) live and b) it's worth actually trying to find a well paid job.
Now. I know that any form of serious, hardcore reform of tax and benefits is fraught with pain. And y'know, unions, and people having tantrums.
Tax brackets, and tiered taxes are primarily because the differential on quality of living of a pound when you're on 5 thousand a year, is a lot lower than when you're on 50.
But what if:
Current benefits system is scrapped. Possibly even pension system too.
Henceforth, everyone with a national insurance number, gets paid a sum of money each week. Approximately the kind of sum needed for 'basic standard of living'.
Everyone is taxed, at a flat rate, on all income. No more VAT, no more capital gains, no more ... anything. Just income. Your pay, taxed once.
And that's it.
Set the taxation threshold to whatever's needed to support the system. This might actually be 30-40%. But, offsetting your tax/compensating for your 'allowance' at lower thresholds, will be this fixed sum each month.
If you're out of work for a while, you get a baseline income, which supports you. It'll encourage you back into work, because you never lose that 'free handout' - work 80 hours, and you still get 80 hours pay (less the tax of course) as well as your baseline.
Maybe implement something similar, for children, paid to parents. I wouldn't have thought necessarily the same amount though (IIRC child benefit and tax credits aren't quite the same value as unemployment benefit, but I honestly have no idea of the _actual_ value of either).
The only other taxation, should be things that have a knock on cost associated with them. Thus you might include tobacco taxation, because it presents a health risk, to subsidise the health service. Or you might up petroleum taxation, because miles driven increases wear and tear on the roads.
For those kinds of tax though, the money should go _directly_ to the place which they're notinonally earmarked for. None of this bull about how the NHS doesn't actually see the funding from increased alcohol or tobbaco taxation. (Although you might reasonable conclude that if drunken behaviour increases policing costs, as well as presenting a health service burden, revenues collected there would be split). And of course, they 're also cut if they're _not_ needed.
Now, if we leave aside the implicit difficulty in a large scale rejig of taxation and benefits systems, for what, 65million people, does this actually look remotely workable?
The difficulty of balancing relaiming enough money that essential stuff can be done, and especially funding things like benefits, but at the same time allowing people to keep enough of their pay, that they can actually a) live and b) it's worth actually trying to find a well paid job.
Now. I know that any form of serious, hardcore reform of tax and benefits is fraught with pain. And y'know, unions, and people having tantrums.
Tax brackets, and tiered taxes are primarily because the differential on quality of living of a pound when you're on 5 thousand a year, is a lot lower than when you're on 50.
But what if:
Current benefits system is scrapped. Possibly even pension system too.
Henceforth, everyone with a national insurance number, gets paid a sum of money each week. Approximately the kind of sum needed for 'basic standard of living'.
Everyone is taxed, at a flat rate, on all income. No more VAT, no more capital gains, no more ... anything. Just income. Your pay, taxed once.
And that's it.
Set the taxation threshold to whatever's needed to support the system. This might actually be 30-40%. But, offsetting your tax/compensating for your 'allowance' at lower thresholds, will be this fixed sum each month.
If you're out of work for a while, you get a baseline income, which supports you. It'll encourage you back into work, because you never lose that 'free handout' - work 80 hours, and you still get 80 hours pay (less the tax of course) as well as your baseline.
Maybe implement something similar, for children, paid to parents. I wouldn't have thought necessarily the same amount though (IIRC child benefit and tax credits aren't quite the same value as unemployment benefit, but I honestly have no idea of the _actual_ value of either).
The only other taxation, should be things that have a knock on cost associated with them. Thus you might include tobacco taxation, because it presents a health risk, to subsidise the health service. Or you might up petroleum taxation, because miles driven increases wear and tear on the roads.
For those kinds of tax though, the money should go _directly_ to the place which they're notinonally earmarked for. None of this bull about how the NHS doesn't actually see the funding from increased alcohol or tobbaco taxation. (Although you might reasonable conclude that if drunken behaviour increases policing costs, as well as presenting a health service burden, revenues collected there would be split). And of course, they 're also cut if they're _not_ needed.
Now, if we leave aside the implicit difficulty in a large scale rejig of taxation and benefits systems, for what, 65million people, does this actually look remotely workable?
no subject
Date: 2007-10-10 03:42 pm (UTC)That goes against the spirit of what Ed is suggesting. You pay it out to everyone, regardless, but all you get is exactly what you need, and no more or less.
Now what I would do is set up a communist-style system, when everybody can go to freely obtain life's basics: dorms, healthy balanced meals 3 times a day, basic clothing, etc. Anyone who wants more than their rations, more flexibility, or wants better quality etc can go and buy them. Whatever more people need than that, eg those who are disabled, you provide physically. But money only comes from working or fulfilling a function. So carers, for example, get paid by the government for providing the care needed.
I agree there are a lot of issues with deciding what counts as income. I like the idea of one flat rate tax. But perhaps it should be based on expenditure rather than income?
no subject
Date: 2007-10-10 05:36 pm (UTC)I think people who contribute to society should be rewarded. But I also believe that someone who is not a useful member of society should not be left to die, or be malnurished or out cold on the streets. There are sometimes good reasons people can't be useful, such as depression. If a person is depressed, they have serious motivation issues, and won't go and get the help they need. If they are forced to take action rather than starve then the long-term productivity of that person is far lower than if they are sustained at cost for a couple of years and allowed to progress normally.
There will always be people who try to take advantage of any system. The point with this is that it asks no questions. You are entitled to the same, no matter who you are and what your circumstances.
no subject
Date: 2007-10-10 05:46 pm (UTC)Putting it on VAT isn't a solution unfortunately - that does almost the opposite of what the tax brackets are intended to address - higher VAT hurts lower income more.
no subject
Date: 2007-10-10 06:03 pm (UTC)Now, I have no doubt that you have an option for 'laziness' here, but ... well I know of quite a few cases of 'long term unemployed' which follow a similar mold today.
I just think it should be worth even putting a 'few' hours of work in, if that's all you can manage (or can be bothered with) rather than the current situation.
Now, you could perhaps bully lazy people, but then you have the whole convoluted mess of figuring out who's _actually_ lazy and just good at hiding it, vs. the people who are actively unable to find a job, or medically unable, or ... whatever.
There'd be no point in 'pretending' because you'd get that money regardless, and if you did actually go do a paper round, you'd get some _more_ money.