1 post tagged “tax credits”

I was driven to think about the absurd situation that most single people have in life regarding working. Most of us agree that we work out of a sheer need and desire for a better lifestyle. It’s a very good reason actually, born out of a need to have more things that make our lives more comfortable and tolerable.

However, ever since I can remember (1985 to be precise, when I left school) I was confronted by the thought that claiming benefits brought with it far more rewards than work could. In hindsight I was earning £35 per week, for which the average bed-sit rent was around £30 - £40 per week at the time. The dole was around £19 per week for under 18’s and if I were renting would have received full housing benefit to cover this cost on top. Earning £35 per week I would have had to pay 65 pence in every £1 I earned above £19 towards my rent. Therefore I would have had to pay £10.40 towards my rent leaving me with £24.60 of my then earnings to spend on as I pleased. A wapping £5.60 better off per week than being on the dole. I know, this was 1985, when a fiver bought a whole evening out on a Saturday night, but still, even my pea-sized brain at 16 had worked out, that working was indeed a waste of time. Fortunately, though I dabbled with unemployment for a year or so, I quickly became bored and decided work was perhaps a better way of improving my lot in the long run.

Now to the current situation, take an average earnings for someone in London, say between £28,000 - £30,000. If you are one of these people stuck in this wage bracket, you are no doubt the ones suffering the most. Why, you may ask? Well at current rates a salary of £30,000 is taxed at a rate of £7985.12 a year and at £28,000 a year at £7325.24. This includes National Insurance payments as well, bless them! If you don’t believe me, please check the figures out yourself, as the link directs you. Of course there is Council Tax to consider as well, which if we assume them to be in band A (the cheapest) with a single person discount the current charge is anywhere between £850 - £1,000 per year in most London boroughs. I’m not even gonna go near sales tax, currently riding at 17.5%, a nice little skim on our regular purchases, but kind of abstract all the same, just the way these thieving cartels (govts) like it of course.

In all this we see a continual drain on our monthly incomes from a filthy lying scum that produces nothing accept thievery upon the masses. As some great soul tunes best described us performed in the 60’s & 70’s, we are nothing but ‘money makers’ for these lazy arses (govt). Now of course one must juxtapose this against Tax Credits, an infamous method for which govt encourages parenthood. Tax Credits are undoubtedly the most difficult benefit to work out. Indeed it is variable depending on your own individual circumstances. Believe me when I say it took me a fair while to put these into some kind of financial perspective that the layman could understand. Let me first explain that you can claim a Tax Credit (with children mind) on as much as £58,000 per year, as much as £66,000 per year if the poor blighter is under one years old. Who in God’s name would consider asking for benefits earning £66,000 per year? With the current inflation rates and the knowledge I’ve gleamed thus far, I would definitely consider it now mind.

And this is what I mean. One would have hoped that having reached £66,000 per year gross earnings that you wouldn’t need to go cap in hand to the govt for a few extra crumbs. But given a govt that recognises a need to explain its very existence, a few crumbs may indeed provide them with sufficient  justification. Given that on those earnings you would be paying £21,460.92 per year in tax and national insurance I would say a few crumbs were indeed wanting. So what do us wage earners decide given this financial conundrum we are faced with? We decide to have fewer kids at an older age. Decisions to marry or cohabit tend to be based on financial need alone, forgetting our personal needs and responsibilities towards these important relationships, particularly to that of children. Those of us that have worked hard and given ourselves beyond average earnings are punished with higher taxes to feed the so called poor, for whom do nothing and achieve very little and on the whole contribute nil to the rest of the world in the form of production. They tend to learn little or nothing about getting along with people, because there is no net gain for them in fostering good relationships with people, because there entitlement (benefits) give them all they require. Welfare is a cancer that eats away at people’s hopes and dreams and provides zilch to a person’s happiness and well-being.

On the flip side there are those, who are working themselves to death, so that they can provide a good life for themselves and their families, who are forced to work longer hours including the wife or Mother of their children. This means they must leave their children in childcare, often with individuals they haven’t had much opportunity to talk with and make a good judgement as to their character. It’s appalling that a couple earning £33,000 each per year are forced to hand over £8975.72 each per year in taxes. These are most definitely the net losers within our system. They will have to pay proportionately far more in taxes than they will ever receive in benefits and will be thanked all the less for it. They are told of course that they are wealthy and enjoying a life that is beyond the reach of the average person. However, since when did someone who has worked hard deserve to have a proportion of their income given to a couple who have no intention of improving their lives through their own labour? The moral distinction is clear, them that work hard are punished and them that sit around are rewarded for their ineptness and rewarded further by producing yet more children. Whereas a couple earning £33,000 per year each are expected to swallow the cost whole, of every child they produce thereafter. Which family is more likely to  make the positive choice to bare more offspring in your opinion?

Another pernicious thing is regarding the area of social housing, otherwise known as Council housing or housing associations. On the whole the social sector of rentals is filled to brimming with the entitled, only some 8% of tenants are working full time and claiming no benefits at all. For the most part, these cheap subsidised rents have no effect on the incomes of the entitled. The only possible positive effect that these cheaper rents provide the tax payer is less tax being spent on housing benefit payments. Who gains from this of course? Govt does. Whilst the general tax payer swallows the cost of market value rents, the inept wallow in cheap housing, for which the govt gladly spends less of our money to waste on other pursuits. These cheaper rents would be an enormous boost to the productive, almost as good as a 30% drop in taxes. But no, social housing is there to provide a cheap housing stock for govt to give to the inept who will never climb out of their malaise, thus keeping govt costs down as much as possible.

I am not saying of course that all people that find themselves on welfare at some point in life are all inept. Of course, many people find that their career and earning potential dries up significantly at certain times in their lives. This is every more reason that when those who are at their most productive should be given the opportunity to save their earnings in perpetuity. Then, when they are in need,  they can draw upon that rich vein of resource they were able to amass during their most productive years. Instead they are left to fend upon the arbitrary nature of govt generosity and how much they feel these individuals are entitled too at any given time. In the long run govt considers their value to be the same as that of someone claiming entitlements throughout their lives. Only those rich enough (the super rich) can easily disguise their resources so as to hold on to them better and not be left with bugger all when the less productive times arrive.