From: "Tim" 
Newsgroups: uk.politics.misc uk.finance
Subject: Re: Astonishing attack on Bank of England : 'Incompetent, sloppy and suffering from mental paralysis'
Date: Mon, 28 Nov 2005 09:09:26 +0000 (UTC)

> > "Ronald Raygun" wrote:
> >> Your figures are misleading because (a) they're
> >> based on marginal income, not total income...
> >
> "Tim" wrote:
> > That was deliberate.
> > When the original article quoted is considering *marginal*
> > rates (see snippet above, now capitalised to aid finding),
> > I thought it best to use them in the calcs too.
>
"Ronald Raygun" wrote
> Fair enough.  Naughty "Thom" for snipping the relevant
> detail, I hadn't read the unadulterated previous post.

Check again.  It *was* in "Thom"'s post!


"Ronald Raygun" wrote
> The comparison may be unfair if you disregard any
> differences there are likely to be in the VAT profiles
> of the different taxpayers' spending characteristics.

OK...

"Ronald Raygun" wrote
> It appears to me that higher earners would be likely to spend less
> than proportionately more of their income on VAT than lower
> earners, as they'd be putting more of their income into housing...

Really?  I'd imagine they'd be able to put just as much, if not more, (even
proportionately) into housing.
After all, any "fixed costs" are using a smaller proportion of their
earnings...

But then if people all spend around (eg; change the multiple as you see fit)
"4 times salary" on their houses (or equivalent in rent), then the
proportion would be the *same*.

"Ronald Raygun" wrote
> ... and, above all, savings.

Those savings will either need to be spent later, or therefore "wasted".