Now that President Obama is belatedly joining his family in Hawaii, it may have been worth the wait for the political benefit of the House Republicans refusal to back a temporary extension of the payroll tax cut. The president won a clear victory. Even the Wall Street Journal's editorial writers asked how the GOP's "circular firing squad" is managing to lose the tax issue to Obama.

It all fine and dandy cutting Income Tax, yet VAT seems to be increasing every time we have a Tory Chancellor.

When Osborne gets around to slapping VAT on food, the 50p rate will be a academic argument.

If we need to cut taxes to free up income for the consumer and we neex to cut spending because we cut taxes, why do we not just shut down the entire government and set the tax rate to zero?

That is the logical conclusion.

The 50p is damaging tax revenues. We seem to forget that the people paying 50% are not UK nationals and have choices where else to be. The much touted public services in the UK are seen as rubbish by foreigners - notably schooling and healthcare. (If you are American you are also paying US federal tax so you may be paying circa 80% tax.) There is a choice between more tax revenue and electoral displeasure - the trap set up by Gordon (party before country Brown). Anecdotally people are leaving London and watch out for an exodus of banks...

C'mon people! Only little people pay tax! The main reason we think 50p tax on high exploiters is admirable is that these unfortunates will walk.
We can't wait to see some of these wealth creators doing the 'perp' walk - should they choose Wall Street.
UK juries never find entrepreneurs, wheeler-dealers,or financial wrong-doers guilty. NEVER. They know their place in the general scheme of things.
And a little birdie tells us the banking and financial community know this for a FACT!

Skint

Cutting the top rate would be suicide.

Already rebuilding their Nasty Party credentials which took them to the heady heights of 23% of the eligible voters in the last election, any credibility of "All in it together" would be laughed off by the vasy majority who earn between £20-30K per annum.

Go on George, do it.

Am not sure how increasing gross domestic consumption assists with increasing gross domestic production. As a nation we over consume and under produce. Hence the unemployment and the high levels of debt.

I agree Luddite, it is how those taxes are spent.

A massive and generous overhaul of the welfare state needs to take place and every single citizen in the UK needs to be lifted out of poverty. The fact that the poor would spend would mean the lower end of the economy would be stimulated, creating a lot of jobs which would reduce welfare dependency. That is where I would like my taxes to go.

The Conservatives policies on welfare and the economy will destabalize both economy and society, which will eventually cost us all far more, both financially and in terms of the kind of world we live in. The members of the super-rich (of which Osborne is a member) won't feel any of it though.

Perhaps a more worthwhile idea than musing about the 50p rate is musing about ways to clamp down on tax avoidance / evasion. How hard would it be to implement a policy whereby if you live in the UK and work in the UK, you pay tax in the UK, regardless of where your bank account or your employer's bank account is based? Decreasing the top rate of tax would make a difference for the few percent of people in that tax bracket without a cunning accountant, but is there any evidence it would persuade those avoiding / evading tax to stop doing so? After all, if you're currently paying 0% tax, reducing the tax rate won't make the blindest bit of difference to you - you're not going to suddenly decide to start paying tax again as even with a lower rate, it would deplete your net income!

As for the 10p rate, I thought personal allowances were being steadily raised over the next few years towards £10,000, so effectively negating the point of reintroducing the basic rate?

we need to re-coordinate gov't spending towards infrastructure spend and reduce admin style jobs.

firstly increase the tax free allowance for the lower and middle income ranges and scrap tax credits - we should let everyone earn 15 to 20 k tax free and take alot of people out of tax.

we should introduce a land wealth tax on immobile assets at the same time reduce taxes on productive mobile assets such as income taxes (which are really taxes on jobs) and business taxes (lower corporate taxes for the north, scotland and northern ireland - this will help diversify the economy away from the public sector over time).

we should subsidise all fees for students on engineering degree courses - this is where we will compete in a future global economy and this is where china and india are strong.

the 50p tax is irrelevant and is there for symbolic reasons, in the long term it sends the wrong signals to the international/foreign investment community and will probably end up reducing our tax take but in the short term we can live with it although it will raise very little.

So the neoliberal programme continues, tax cuts for the rich whilst they extract all the surplus wealth, shrinking the real economy and forcing the poor into further debt peonage.

The fallacy that we need the rich must end before the vast majority of people can see their living standards rise.

The 50% tax argument is just a sideshow.

And on the subject of degree courses, funding is essential for 'the Arts'. I should think I part ways with Luddite there, but the UK is built on our IP.

To paraphrase JoeDeMocritus...

The State has to step right up and reform the tax system to ensure the wealthy pay their share. Rich people must realise that they are responsible for the less well off and their wellbeing, as in Victorian times.

The welfare system should only be a short term saftynet to tide people over but when the capitalist system creates an environment where jobs are at a premium it falls the those better off to support the rest.

We're all in this together, aren't we Georgie Boy?

It would be nice if the press actually stated the facts correctly about the 50p tax rate. Clearly the 50p tax rate is paid by high income earners, however within the top 2% of earners the tax system is highly regressive. The richest people in general have the means to shelter their income and wealth via companies and offshore vehicles. The burden of the 50p tax rate mostly falls on the professional class - it is the middle class that is paying all the tax, not the rich. Taxing the rich can be achieved by other means such as property taxes, the 50p tax rate drives highly skilled people away from the UK and is therefore growth negative. The UK needs to design an effective, fair and progressive taxation system to help fuel the economy.