The US Congressional Budget Office has recently published some information on who pays income tax in the US (or, at least, who did so in 2010). There’s an interesting graph included showing how effective tax rates vary by income group over time. Continue reading “A progressive approach to tax”
A 50% tax rate was introduced to the UK in April 2010, to apply to all earnings over £150,000. This high tax rate was devised to raise additional income for the treasury by increasing the payments made by the highest earners, therefore increasing the Robin Hood effect of income tax.
However, it is likely that this higher tax rate is unlikely to increase tax receipts to the degree that the government would like. Continue reading “Disincentivising high incomes”