Labour supporters want tax hikes even if they bring in no more revenue

February 3rd, 2014 at 12:00 pm by David Farrar

writes in the Telegraph:

Ponder the graph above. Sixty-nine per cent of [UK] Labour supporters would want a top rate of 50 per cent even if it brought in no money.

I’m sure they’d dispute the premise. I’m sure they’d insist that it did bring money in. And, on one level, they’d believe it; it’s human nature to start with the result we want and then rationalise it to ourselves with what look like hard data. I think their rationalisation would be false, obviously – once the behavioural consequences of the tax are factored in, it becomes a net drain on revenue – but I might be subject to my own confirmation bias in the other direction.

Anyway, this isn’t a blog about the statistics – I’ve already posted one of those. No, this is a blog about the mind-set of people who see taxation, not as an unpleasant necessity, but as a way to punish others.

This is amazing. Over two thirds of UK Labour supporters want higher taxes, even if those higher taxes did not produce more revenue for the Government.

I wonder what the percentage would be in NZ?

Envy is an ugly and debilitating condition, but it seems to have an evolutionary-biological basis. The dosage varies enormously from individual to individual, but even toddlers often display a sense that, if they can’t have something, no one else should either. If they had the vocabulary, they would doubtless, like the 69 per cent of Labour supporters, explain that emotion “on moral grounds”. Few toddlers, and few Labour voters, openly admit to being actuated by vindictiveness.

Hannan also touched on :

I accept that there are advantages in homogenous, Nordic-type societies. Huge inequalities of wealth can lead to higher stress levels, higher crime rates and weaker social engagement (oddly, the people who deploy these arguments in support of economic homogeneity almost never extend them to multiculturalism, but that’s another story).

The case against state-enforced equality is not that a narrowing of the wealth gap is in itself a bad thing; it’s that it carries a disproportionate cost in terms of lost prosperity and lost freedom.

Wealth taxes make societies more equal; but they do so by making them less prosperous. We can push plutocrats into shifting their money abroad. We can drive hedgies to Singapore or Switzerland. We can, more prosaically, make entrepreneurs spend more time with their accountants and less creating jobs. We can encourage by far the most common forms of legal tax avoidance: shorter hours and earlier retirement. All these things will make our country more equal. All of them will make it poorer.

And be careful with what you wish for:

Following the credit crunch, inequality fell. City salaries plummeted, average salaries fell slightly, benefits stagnated. In other words, the 69 per cent got their way: Britain became poorer and more equal. Yet, in the event, it was Labour supporters who moaned loudest. There’s no pleasing some people.

The focus should be on economic growth. If you grow the pie, then you get better options as to how to divide it up. Taking more tax off hard working taxpayers so you can give it parents earning $140,000 does not grow the pie.

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33 Responses to “Labour supporters want tax hikes even if they bring in no more revenue”

  1. peterwn (3,164 comments) says:

    Why can’t we have a newspaper like ‘The [UK] Telegraph’ in NZ?

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  2. vibenna (305 comments) says:

    If you grow the pie, you have more money to give to yachting syndicates, casinos, foreign mining companies, monopolies, and merchant bankers. But it’s not essential, even without growth you can always cut benefits to achieve the same ends.

    Hot debate. What do you think? Thumb up 2 Thumb down 31 You need to be logged in to vote
  3. PaulL (5,874 comments) says:

    What many people dislike is not so much inequality, but visible displays of inequality. There is a reason that many with old money don’t flash it around so much – their families learned hundreds of years ago that when you flash it around people start to want to take it off you.

    So, an alternative to pushing high taxes etc would be to just outlaw the excesses that people don’t like seeing. :-)

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  4. queenstfarmer (747 comments) says:

    I am not surprised. Pro-Labour supporters on this site have argued that NZ should unilaterlally attempt to tax foreign corporations (Facebook and Google) even if doing so would cost NZ jobs and billions of dollars in economic harm.

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  5. tvb (4,210 comments) says:

    The Labour Party see the tax system as a means to punish the rich. Getting in revenue is not the only objective.

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  6. Nigel Kearney (864 comments) says:

    No doubt there is plenty of envy out there, but I don’t think it is the explanation for this.

    Most people simply cannot get their head around the idea that higher tax rates may not produce more revenue, because they don’t consider the fact that government policy changes behaviour. They have no trouble understanding why it does, if this is explained to them, but it never has been before.

    Postulating a hypothetical that the listener utterly rejects is ok for a philosophy class, but will just lead to nonsense when dealing with typical members of the public.

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  7. igm (1,413 comments) says:

    This is the doctrine of “Tojo” Cunliffe, screw hard working successful who have a few bucks and assets, this sating the envious leeching unionists he has to appease for support. If these scum get near Treasury, there will be a mass migration of employers, businesses and capital . . . the country will be stuffed and unemployment rife. God help us!

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  8. YesWeDid (1,029 comments) says:

    So you couldn’t fit ‘UK’ into the headline DPF? Happy to imply that it was NZ labour supporters that wanted the extra tax?

    Don’t you regularly moan about other media having misleading headlines?

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  9. wf (374 comments) says:

    igm said
    ” . . . . .If these scum get near Treasury, there will be a mass migration of employers, businesses and capital . . .”

    A lot of people will simply hunker down, work out how to milk the system, and wait in till the masses get sick of being told what to do by a Labour et al govt and vote the other side back in.

    Swings and roundabouts for some.

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  10. Paulus (2,503 comments) says:

    The biggest problem in those demanding higher taxes in both UK and New Zealand is that the demands come from those who actually pay no tax anyway.

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  11. YesWeDid (1,029 comments) says:

    Paulus are you suggesting that NZ Labour MP’s pay no tax?

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  12. nickb (3,659 comments) says:

    YesWeDid- just look at all their family trusts on the pecuniary interests register.

    Oh wait – these are just for “asset protection” (to quote Stuart Nash when quizzed on his own trust)

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  13. YesWeDid (1,029 comments) says:

    So Labour MP’s aren’t allowed to have family trusts but it’s OK for National MP’s?

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  14. Jim (400 comments) says:

    The Left’s blindspot is the productive side of the economy. The workers, tradespeople, professionals and businesses that pay significantly more in tax than they receive in handouts. These are the people who are carrying the country.

    Listening to Labour and the Greens I wonder if they even acknowledge such people exist. That they believe the only people who pay tax are wealthy enough that it won’t hurt them a bit.

    The left would like to make wealthy people an endangered species (reducing inequality) but haven’t thought about that enough to work out where the tax revenue will come from after chasing out the people who pay it.

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  15. big bruv (13,316 comments) says:

    “So Labour MP’s aren’t allowed to have family trusts but it’s OK for National MP’s?”

    Yep, that’s what we are saying.

    I did not think you would have a problem with that at all given that the left have always been of the opinion that there are rules for them and rules for others.

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  16. nickb (3,659 comments) says:

    Its fine for all MPs YWD. But National aren’t being hypocrites by stirring up scaremongering based on false premises (namely, that tax is levied on revenue, a retarded mistake).

    Maybe if we are so concerned about our tax revenue we should look closer to home – like at tradesman doing cashies, or our local Labour MP income splitting using a family trust….

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  17. burt (7,828 comments) says:

    Policies of envy ….

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  18. dime (9,468 comments) says:

    just sad. you could imagine the types who said yes.

    * the loser on the bludge

    or

    * a bitter left winger who thinks hes really smart.. he just cant quite figure out how to make money. therefor the rich should be punished.

    or

    * teachers

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  19. Joanne (177 comments) says:

    Labour wants to change the way we tax corporations too. They want entities to pay tax based on total revenue.

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  20. chris (567 comments) says:

    So Labour MP’s aren’t allowed to have family trusts but it’s OK for National MP’s?

    Sure they are, but they’re a bunch of freaking hypocrites. Do as I say…

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  21. burt (7,828 comments) says:

    Joanne

    They want entities to pay tax based on total revenue.

    They could lead the way – perhaps 20% of all donations made to Labour could be paid as tax ?

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  22. burt (7,828 comments) says:

    Shearer could set up a consultancy on how to avoid tax in NZ by keeping your own money off shore !

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  23. unaha-closp (1,115 comments) says:

    This is the UK, where the whole financial sector has been on the bludge for the past 5 years. The British banks of 2010s are like the British coal mines were back in the 1980.

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  24. igm (1,413 comments) says:

    burt: Hear tell “Tojo” has a fair plant of cash offshore!

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  25. JC (909 comments) says:

    When will someone point out that the harpies on the left who scream inequality sometimes wear $4000 jackets, live in castles and generally live high on the hog…?

    JC

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  26. burt (7,828 comments) says:

    JC

    It’s different when Labour do it !

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  27. Manolo (13,386 comments) says:

    The policies of envy usually promoted by envious people, the perennial losers in life.
    Punish the successful is the mob’s motto.

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  28. slijmbal (1,216 comments) says:

    This is not unlike some reasonably well off Ponsonby types I know who squeal about how on earth do the likes of Gates actually need their billions. Of course, past about a couple of hundred million it is hard to spend it all without being silly but what is missed is that if Gates gets richer a lot of other people also get richer. If he lost money lots of others lose money.

    IT IS NOT ZERO SUM GAME.

    I feel better for that ………

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  29. Fentex (867 comments) says:

    Over two thirds of UK Labour supporters want higher taxes, even if those higher taxes did not produce more revenue for the Government.

    That is an odd thing, and I’m suspicious of the claims source for even as the person writing the articles say “I’m sure they’d dispute the premise. I’m sure they’d insist that it did bring money in”. Which seems to be an explicit admission that the claim hasn’t a very strong foundation.

    It doesn’t seem hard to imagine people interested in what they think is fair would use levels of taxation as a proxy – one imagines they think it implicit that a high rate of inflation is levelled as they think would be fair and casting their decision as mindless is about as accurate as casting anyone’s opinion on a loaded topic in the light you please. Seems as likely useful as Humphrey Applebys famous examples of polls designed to get what answer you please.

    Ask those same people if they support high tax rates if it causes them to lose their jobs and be amazed at the different answers.

    But I’m sure as DPF has promised us that he never repeats such reports without investigating their methodology he’ll shortly report on the details of the source this statistic (which I noticed has a YouGov image attached, so I suppose it started with some kind of questioner on the UK’s government web site).

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  30. Recidivist_offender (22 comments) says:

    If they dont tax em, we’ll rob em!

    It’s your choice fat cats!

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  31. Recidivist_offender (22 comments) says:

    @ Dime

    Well, your just a cynical Misanthropic cunt aren’t you?

    What do you do when you see the donation collectors on the street. Flash a sneer of contempt, mutter ‘ take responsibility for your own lives’, pat your wallet, stoke your ego, carry on home and admire yourself in the mirror.

    Here’s your cue for your ‘earnest’ refutement’ of the facts. Go ahead, blow your trumpet and lets hear how smart you are?

    SARCASTIC SNEERING REPLIES ARE EXPECTED.

    FEED THE TROLL WITH A THUMBS DOWN. THANKYOU IN ADVANCE.

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  32. slightlyrighty (2,496 comments) says:

    As the French Socialist Jacques Delors once said…

    “This desire for equity must not lead to an excess of welfare, where nobody is responsible for anything.”

    He also said

    “The problem of how we finance the welfare state should not obscure a separate issue: if each person thinks he has an inalienable right to welfare, no matter what happens to the world, that’s not equity, it’s just creating a society where you can’t ask anything of people.”

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  33. burt (7,828 comments) says:

    Recidivist_offender

    What’s a fat cat these days? It was simple under Cullen, it was pretty much anyone who earned more than a starting high school teacher. What is a fat cut under Labour.

    See taxing them us one thing, taxing them fairly and effectively that’s a different story. But let’s clearly identify the target. Is it anyone who earns more than a beneficiary, a high school teacher, a lawyer or just the generic rich prick perceived to be earning too much?

    What about people with undisclosed large sums off shore, big houses in expensive suburbs, do we make exceptions if they have a red flag or do we treat these people differently if they carry a blue flag ?

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