Sunday, April 26, 2009

Britain's Tax Hike: Andrew Lloyd Webber Predicts Exodus

Andrew Lloyd Webber, the famed British native and composer of some of the greatest works on Broadway, predicts the "wealth creators" will exodus Britain once a new tax code is implemented. See two great videos below.

Andrew Lloyd Webber
Webber fears an exodus of wealth and of talent: "The last thing this country needs is a pirate raid on the wealth creators who still dare navigate our stormy waters...." "Here's the truth," he says:
The proposed top rate of income tax is not 50 per cent. It is 50 per cent plus 1.5 per cent national insurance paid by employees plus 13.3 per cent paid by employers. That's not 50 per cent. Two years from now, Britain will have the highest tax rate on earned income of any developed country.
I write this article because I fear the inevitable exodus of the talent that can dig us out of the hole we find ourselves in. It is inevitable, given that other countries are bidding for entrepreneurs. The Government must modify its proposals.
Sounds familiar doesn't it. Here's more:
I give you this example. I have altered the details of the family I write about for obvious reasons. But the essentials are true.
Last Thursday I met with a thirtysomething guy. I absolutely depend on him in a highly technical area of theatrical production. For legal reasons he has to employ himself through his own company. Under the new tax regime, he will have to pay 13.3 per cent to employ himself before he pays himself anything. And then he will have to pay 51.5 per cent on what's left.
This is a guy at the cutting edge of his profession who works all over the world. He is in demand in every major territory where entertainment is produced. He has a young wife and two children. Last Thursday he told me that he and his wife had decided that the UK was no longer where they wanted to live.
His wife thinks the State education system is inadequate. And she fears that a bankrupt Britain will increasingly be a worse place in which to live as the horror of our present financial mess hits us all in the solar plexus.
He says that he is young enough to set up shop somewhere else. The new tax rates were the final straw. These talented young people know they will make it impossible for them to educate their kids privately in the UK.
So Britain plc loses not just the 40 per cent he would have paid in personal taxes under the old regime - plus NI and everything else - but... Come on, I don't need to explain the knock-on effect. It's obviously huge and immensely damaging - that's why I am writing this article quickly and probably with too much passion.
The following is an explanation from Forbes of President Obama's tax plan for those considered "high-earners. You might want to bookmark this Forbes piece. It is an easy to understand assessment of the tax code for all income levels.
But for high-earners, the biggest change will come from the tax increases the president proposed as part of his budget. (See "Who Will Pay for Obama's Plans?") Obama wants to allow the Bush tax cuts to expire at the end of 2010. If Obama gets Congress to cooperate, then beginning in 2011 single taxpayers earning more than $200,000 (more than $250,000 for couples) would see the top ordinary income tax rate rise to 39.6% from 35%.
Another tax code tweak unveiled in Obama's budget is a change to itemized deductions. Families earning more than $250,000 would take deductions against a 28% tax rate, instead of the tax rate they're actually paying. For many upper-income tax payers, this not only increases their tax burden but reduces their incentive to give to charities (see "Short-Changing Charities").
Lord Webber sees "pirate raids" on the homeland as well as on the high seas. It's an apt equivalent. Okay, nothing to do with taxes: take a few minutes to listen to two favorites from Andrew Lloyd Webber.

Andrew Lloyd Webber, Cats - "Memory"

Andrew Lloyd Webber - David Cook, American Idol 2008 interview with Webber singing Phantom's "The Music of the Night"

©2007-2012copyrightMaggie M. Thornton