21-06-16, 05:37 PM
(20-06-16, 04:23 PM)Millietant link Wrote: I think you're agreeing me - if one is stronger, they carry proportionally more bricks.....
No, I'm pointing out that, under the flat rate tax system that you advocate, those who can carry a proportionally larger burden *do not*.
It's not simply a case of "if everyone pays the same percentage of their income as tax, that's fair" because it ignores what's called the "marginal propensity to consume", ie the proportion of your income that you actually spend.
If you earn £1000 a month (after tax) and spend £1000 a month, your MPtC is 100%. If (to pick a figure) you earn £10,000 a month (after tax), however, you are very unlikely to spend £10,000 a month, you might spend (to pick another figure) £4000, ie your MPtC is 40%. The second person is left with £6000 a month to save, the first person has *nothing* to save because they have to spend it all to live.
It's all very well saying "equality in taxes", but the effect of tax on the low earners is *much* greater than the effect on the higher earners. Simply saying "they pay the same proportion" misses this fundamental issue. This is the misunderstanding that gives us the claims of the so-called "trickle down" effect where, supposedly, the poorer benefit from the richers' spending, except that much of what the richer people earn is *not* spent, but is put away in financial institutions which only benefit those who can actually afford to invest in them.
Getting back to the original subject about the "extra amount" that the EU "demanded" from us (according to the terms that *we* agreed to!), it goes to people who *will* spend it and put it back into circulation which is my point.