Why do the poor pay any tax?

There is a good reason, which is that in a democracy there will always be the temptation for the many to "fleece" the few. The majority can become a tyranny. It is dangerous that the many can vote benefits or advantages for themselves, leaving others to pick up the tab. There should be no representation without taxation, to misquote the old American saying.

In other words democracy is fine while it does not "attack" a group or groups, but if some groups use their power to damage others then it will impose great dangers.

Having said all this, it is clear that we are in a ridiculous situation where the Government decrees the level of minimum hourly wages that must be paid, and yet anyone earning this on a full time basis will pay tax on about half of his income. Given the personal allowance against tax of about £6000, and a forty hour week, a 52 weeks a year job at minimum wage producing at least £12,000 annually, the income earner will pay about £1,200 a year in tax. This makes no allowance for any other stoppages, such as national insurance, pension contributions, etc.

There is clearly something wrong when the minimum wage deemed to be necessary suffers a 10% deduction in tax. The logical conclusion is that the personal allowance against tax should be raised to remove minimum wage earners from tax liability.

The problem is that the personal allowance would have to be raised for all employees, and the highest paid would gain more through about £6,000 of income at the top rate of 40% escaping tax. We have got ourselves into this situation by stealth and because Brown & Co felt they needed so much tax that to tax the rich much more heavily could cause them to move from Brown's jurisdiction, i.e. go elsewhere. In other words, individuals could would vote with their feet, as companies are threatening in the face of high corporation taxes.

For some of us there is an international competitive market in income and company taxation. As usual, we have fudged the issue in this country.

Ultimately and logically lower incomes may be boosted either by passing laws on minimum wages, - the "easy" or tempting way, or by increasing worker productivity to make employers prize them more highly.

Tax thresholds must be raised to make it worthwhile to work, and benefits must not overtake wages or else we have the familiar poverty trap.

Bottler would not accept it, because he believes that he is helping the poor by employing vast armies of bureaucrats or paying dizzy incomes to doctors or local authority managers. He has to learn that if the Government attempted less, employed fewer and wasted less, the general level of taxation could be reduced, and as a consequence some of the problems above could be greatly reduced. I fear that without structural reform of the NHS and education, etc., and reduction of Government activity in every nook and cranny, his approach is doomed to produce the problems we are having.