Andrew Roberts in his Saturday Essay in the Daily Mail today:
In 1938 only 3.8 million Britons paid income tax; by 2003 this had mushroomed to 30.07 million.In his ground-breaking book 'The Welfare State We're In', James Bartholomew points out how most wages used to fall below the income tax threshold:
"The typical working man and his wife in 1950 lived an income-tax-free existence.
"They could keep every penny they earned. This simple fact made the two-parent family eminently viable. It was just left alone."
The benefits for society of this system were inestimable. Today those with well below average earnings are caught in the tax net, and as Bartholomew shows:
"The State has even brought about a situation where, in some cases, two parents are considerable better off living apart than together."
(I might add that the two parents on average earnings, in this instance, were assumed to have two children. Children's tax allowances were very substantial. They were much more efficient than Children's Tax Credits because every couple with children got the allowances automatically. Many couples with children who would be entitled to Children's Tax Credits do not get them because they either do not know about them or else cannot face the paperwork involved.)
Posted by James Bartholomew • Indexed in Parenting • Reviews
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Why is this "groundbreaking"?
I've been using this argument that Income Tax was never intended to catch everyone but only the very well off for a long time now. I think if you have a look the thing that really broke it out into the general population was paying for two world wars.
Posted by: Jock Coats at March 25, 2006 08:50 PM