Taxation Assignment Example | Topics and Well Written Essays - 1500 words - 2

Taxation - Assignment ExampleIt was the first ever sum up as the highest respect of income impose in the history of UK for over three decades.In 2010,the Chancellor Alastair Darling announced the 50% tax rate. With effect from April 2010 onwards, assessable income above 150,000 in UK will be subject to a new top rate of income tax of 50%.The 50% additional rate of income tax was announced by the erstwhile labour government in 2010 was mainly intended to rescue the UKs economy after the 2008 financial crisis. As per HMRC data, 10 bn was raised during the three years when the top 50% rate was in force.The present UK government has reduced the top rate to 45% with the effect from April 2013 onwards. indicate from UK and around the globe demonstrates that punitive tax levels either 50% or 45% will result in poor revenue collection as compared to modest rates. Young & Saltiel (2013) study found that behavioural reaction to the higher tax rates is more robust, and this is likely to h urt UKs tax receipts.The 50% additional rate of income tax in UK had a bad impact on UKs economy as its architects themselves confessed that the scheme was introduced without economic objectives. Young & Saltiel (2013) found that the policy is coping for failure as it resulted in the flat growth for a decade and ended in 350bn of lost revenue. This essay will analyse whether the UK government cure the 50% additional rate of income tax? or not .As per Ed Balls of Labour Party, that his party will reintroduce 50% additional rate of income tax for those whose annual income is above 150,000 if it is voted to power in the coming election. According to him, as per recent statistics, those who are earning more than 150,000 paid 10bn more by government agency of taxes in the last three years starting from April 2010 when the rate was 50% for them. Again, it was reduced to 45% in 2013 by the present Coalition government. As per Ed Balls, when the