Petition to save tax for £100k+ earners fall flat

23 October 2015

The good thing about living in a democracy, even one run by politicians, is that there is some scope for people power, and burning issues dear to the hearts of the electorate can become pressing issues for parliament. Take the current debate on cutting tax credits- rumour has it that the House of Lords is set to step outside its accepted jurisdiction in order to stand up for the people.

In modern electronic times, getting the Government's attention has never been so easy- with the online petition system, you just need to find 9,999 like-minded people to get a response from government or 999,999 other people to get a motion tabled in parliament. Easy peasy. And you would think that a petition calling for a reduction in tax rate would be incredibly popular, racing to those 10,000 signatures within hours and 100,000 in a matter of days right? Er no.

A new petition calling for a reduction in tax rate for those earning over £100,000 a year has attracted the whopping sum of 11 signatures. Not 1100 or 11,000, but the petitioner and ten of his friends.

telegraph tax petitionThe specific issue William Mahony, the founder of the petition, is disgruntled about is the so-called 62% tax rate applied to those earning between £100,000 and (currently) £121,200. At this point you may be scratching your head in confusion, as you probably understood that there were three rates of income tax, 20% (between £10,600 personal allowance and £42,385), 40% (between £42,385 and £150,000) and 45% (for income over £150,000). None of these rates are 62% so what is the guy talking about?

While he may be ranting, however, he is not raving. The "62%" applies only to that very narrow band of income as it is here that the personal allowance is tapered away, meaning that, proportionately, there is more tax paid in this band. As the rate of taper is £1 reduction in allowance for every £2 of income, that essentially adds 50% of the actual tax rate (40% at those income levels) on to the effective tax rate, making 60%. He then bungs on the 2% Class 1 national insurance cost paid by employees for good measure, to get to 62%.

However the petition, which was started on October 12th, only received 11 supporters, leaving it a long way to go to get to even the first milestone within its six-month validity period.

Mahony, a chartered surveyor from London, said: "I am happy to pay my share within a progressive tax system, but that it’s not right that people in this bracket pay a higher marginal rate than those earning above £150,000 a year.”

But is this true? The constructed 62% rate only applies to £21,200 worth of income, that falling between £100,000 and £121,200; the rest is taxed at 20% or 40% (plus any national insurance, as appropriate, which is also payable in exactly the same amounts by even higher earners). Those earning over £150,000 do not get the benefit of the personal allowance either, so claiming these people are paying more tax is, essentially, a fallacy.

Mahony continued, endearing himself to the majority of the UK electorate:

"Nobody should pay over half of their income in tax. I also think it’s unfortunate that most people will think that earning £100,000 a year is a lot. They would probably be rather surprised at London house prices. We are not rich.”

In case you have any sympathy left, or you just have a morbid curiosity, the petition can be accessed here . Note that since the petition was reported in the Telegraph, it has been deluged with a swathe of new signatories. It might even reach 300 before the end of the month…



  • Ian
    Thanks, now signed. The more publicity this gets the better as I hadn't heard about it until reading The Telegraph this AM.
  • Judy S.
    Would like to support but cannot access the 'sign the petition'? This campaign has not been well publicised?
  • Bry
    Signed too - Typical BS journalism missing the point.
  • jt
    Well done, only 98,839 to go. Good luck with that!
  • Brian
    I've signed too. I think we're up to 1,100 signatures thanks to the publicity of this blog. Glad you're looking out for everyone, not just the scroungers.
  • Patrick
    I'm going to sign this as it affects me. Many people working long hours as permanent employees in IT & the financial sector are affected. To avoid it many of them switch to contracting and end up paying less than 15% tax on £100k+ incomes without any hassle from the taxman. The problem is that the system is very unfair - employees are heavily penalised whereby the £100k+ contractors in some cases end up paying less total tax than an average wage earner.
  • Raggedy
    Yes this system is so unfair, it's no wonder they have to get rid of the tax credits to claw back the tax you won't be paying. Never mind, that the so called "scroungers" might not be able to put food on the table, at least you'll be able to afford another bottle of Cristal. :-)
  • Pie M.
    Why do these rich bastards need a petition? They've got a Tory govt FFS.

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