Top rate income tax cuts: 89 percent go to men, 11 percent to women

   0   0 Blog, Gender
Women tax cuts

Sharing out the proposed tax cut from 45 to 40 percent

From The UK’s Mirror newspaper:

“If George Osborne [the UK Finance Minister] slashes the rate further in the Budget – from 45p to 40p for those on £150,000 or more – will put even more money in men’s pockets.

Analysis by the Tax Justice Network found there are 339,000 people (284,000 men and 55,000 women) earning above that level.

Cutting the rate to 40p would be worth £3.3billion to high-earning men (89%) but just £428million to wealthy women (11%)”

(Hat tip to Jolyon Maugham for that 339,000 figure, of which 83.8% are men.) We recently explained how a proposed cut to the UK top rate of income tax from 45 percent to 50 percent (for incomes over £150,000) would see 83.8 percent of the tax cut going directly to men, and 16.2 percent to women.

That’s counting the number of taxpayers affected. But now let’s ask how much of the £ value of this tax cut would go to women.

The answer is: a bit over £3.3 billion would flow to men, and £428 million to women.

That is, 11.4 percent of the tax cuts will go directly to women and 88.6 percent to men.

As in our simple picture here.

Here’s the calculation (scroll up to the top).

For the source data, and for some background discussion of what the numbers mean, please see our earlier blog.

Of course, households often include both women and men – so benefits to male higher earners will sometimes have knock-on effects that reduce the immediate gender inequality impact. We still lack good data on this point, but it’s clear that if you have any concern with gender inequality, you certainly wouldn’t start by cutting tax for the highest-earning men in the hope of some kind of gender ‘trickle-down’.

And of course this is based on latest available data which is from 2013-14, and this tax cut being mulled is for the future. If the threshhold for the top rate of income tax were changed, that would change the calculation too. So this is not a precise forecast, but we think it’s a pretty good indication.

Having said all this on the revenue side, it’s worth noting that women get hit by tax cuts on the spending side too. As the Mirror summarises:

“A House of Commons library analysis of Mr Osborne’s 2015 autumn statement found it hit women three times harder than men because of the cuts to benefits and tax changes.”

That study is summarised here. See more on our gender and tax justice page.

 

 


Related Posts

Launch of international research collaboration, #AltAusterity

alt austerityToday is the launch of #AltAusterity, a new, international research collaboration of which Tax Justice Network is a partner.  The project aims to stimulate public debate on the subject of austerity though high quality research. It is a response to the lack of evidence which has underpinned the current policy agenda on austerity. The project […]

READ MORE →

RB tax avoidance – company calls for public country by country reporting after Oxfam report reveals profit shifting

pictureOxfam has today released a report on tax dodging by RB, the company formerly known as Reckitt Benckiser and the maker of thousands of well known household products. The report looks at the 2012 restructuring of the company which saw it set up ‘hubs’ in the Netherlands, Dubai and Singapore, all well known corporate tax […]

READ MORE →

Half measures mean Mauritius will continue to be a tax haven for the developing world

MauritiusThere was news this week that Mauritius has signed the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI). This is an initiative from the OECD to allow countries to take measures designed to stop tax avoidance by multinational companies and put them into their existing network of […]

READ MORE →

G20: Pressure rising on tax haven USA

HamburgWhilst the eyes of the world focused on the isolation of the US from the ‘G19’ position on climate change, something remarkable played out elsewhere in the process. Following closely the common EU position that we highlighted a few days ago, the G20 communique devotes important space to tax justice. It’s so good we quote […]

READ MORE →

Will the G20 ever end the global problem of tax avoidance and tax evasion?

HamburgAhead of the G20 Summit in Hamburg this week our own George Turner has published this op-ed in the German newspaper Die Tageszeitung today. The article discusses why, despite sustained political engagement from world leaders, we are still some way from solving the problem of tax avoidance and tax evasion. Here’s an English translation of the article:

READ MORE →

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to Top