From: anw@maths.nott.ac.uk (Dr A. N. Walker)
Newsgroups: uk.politics,soc.culture.british
Subject: Re: Simple message
Date: 7 Apr 92 16:37:29 GMT
Reply-To: anw@maths.nott.ac.uk (Dr A. N. Walker)
Organization: Maths Dept., Nott'm Univ., UK.

In article <1992Apr7.120625.9921@rtf.bt.co.uk> traub@rtf.bt.co.uk
(Michael Traub) writes:

[abount consuming VAT-rated goods in proportion to income]
>I didn't ask if it was *possible*, I asked if it was probable.

	I can only quote from personal acquaintances.  I have a [distant,
unfortunately] relative-in-law whose income is around 10 times mine;  call
him A.  [He works jolly hard for his money, and I envy him neither his
life-style nor his ulcer.]  I know a couple of other people reasonably
well who also, by setting up their own companies, have similarly large
incomes, so I am confident that A's life-style is not untypical.  I know
a few people who are trying, at a similar age and with similar families,
to live on about 1/3 of my salary.  Call a typical one B.

	A owns a large house near London, with a lodge where his full-time
handyman and housekeeper live, a holiday home in Suffolk, and another in
Minorca.  He drives spanking new BMWs, occasionally Bentleys.  He jets off
to the West Indies, Malaysia, etc for family holidays [sometimes mixed with
business].  He has a wine cellar, computers all over the place, etc., etc.
He dines out most nights, often goes to West End theatres, etc.

	I own [subject to mortgage!] a quite nice detached house in suburbia,
drive an 8-y-o second-hand Cavalier, holiday in Brittany or Cornwall or
Scotland, have a few bottles of wine in the house, and a second-hand Beeb.
We get out to a restaurant about twice a year, apart from when on holiday,
rarely manage a theatre or concert.

	B has a council flat, no car, occasionally gets a week at Butlins,
never drinks wine, has no computer, never eats out, rarely goes out further
than the pub for any social occasion.

	Do you *really* think that I am not spending more than three times
as much as B on these [and many other] things?  Or that A is not spending
more than ten times as much again?

>								While you
>insist you would employ ten times as many maids and gardeners I don't
>believe you.

	Well, that's a little unfortunate.  You're too far away for us
to fight a duel.  How do you suggest we resolve this?

>		I may consume three times the amount I consumed as a student
>but my income is now *thirty* times what it was as a student!

	Students rarely own houses, have wives and 2.2 children, etc.  It's
difficult to extrapolate from the typically rather bizarre student patterns
of expenditure to what people spend when they have responsibilities and a
steady job.  How much do you think your expenditure on luxury goods would
decline *now* if your income were slashed by 97%?

>In case you hadn't realised you don't pay *any* tax on a mortgage.

	For A and I, the difference between paying a tax and not being
allowed a tax relief is zero.

>Would  your  house be ten times as large? Would you have 30 bedrooms rather
>than  3?

	See example above.  He certainly owns more than 20, to my 2-and-a-bit.

>Can  you  actually  provide any examples showing that a person on ten times
>the income of another person pays ten times the amount of VAT?

	See examples above.

>								If not then
>you should agree that VAT is an unfair tax.

	I actually passed no comment whatsoever on the fairness of VAT.
But as a matter of fact, I believe that VAT is about the *fairest* tax
that we *currently* have.  That's not to say that it couldn't be made
more fair.  Certainly, income tax, as *currently* constituted, is very
far from fair;  so are all the rates schemes, old and new;  so are TV
licence fees, etc.

-- 
Andy Walker, Maths Dept., Nott'm Univ., UK.
anw@maths.nott.ac.uk