Restoring the 50% rate on dividends is essential, but don’t mention Richard Murphy

Ed Balls got his economics quite extraordinarily wrong yesterday, for reasons that I cannot be bothered to explain. But he got the restoration of the 50p tax rate absolutely right.

I have written on this issue extensively. I wrote a report for the TUC in which I wittered on about “the 50p rate” without mentioning the different rate of tax on dividends and how the effective rate is variable according to the rate of corporation tax.

Of course, this left me open to mockery from my parodist, Richard Murphy, who decided to incorrectly correct people on what the rate of tax was on dividends without offering any explanation other than “it’s complicated”. This is presumably because he doesn’t know enough about tax to create a funny reason.

Somehow, he was able to do this before I published the report in March 2012.

So very wrongAnd then he was just plain rude to people who were trying, politely, to point out his error.

So very very wrongThis cumulated in a famous post where the lampoonist managed to engage genuine tax experts who did not realise that Richard Murphy’s only purpose was to say the most ridiculously incorrect thing possible.

So completely wrongSo utterly wrongHe even drew me into the fray.

I must confess that I truly believed that he honestly thought he was genuinely correct, and was simply rather incompetent, as opposed to being a lame parody of a true expert.

Finally, the prankster revealed that he had never actually done a proper income tax calculation and abruptly ceased comments on the blog.

And finallySo “Richard Murphy” insinuated that I was not even aware that dividends did not carry a tax credit equivalent to the corporation tax paid and that they only carried a notional 10% tax credit and that it was the gross dividend used in the income tax calculation rather than the net dividend and therefore the rate of tax on dividends was always 50% and that I simply assumed other people were wrong rather than bothering to check the facts and figures myself.

Of course, none of this is correct. Because I am fully aware that the effective rate of tax on dividends was always 50%.

But this might still be considered funny to some, especially now that the 50p rate will be reintroduced under a Labour State, and that we can expect Richard Murphy to trot all his old materials that contain these “amusing” errors. But it is not.

It is not funny.

It is just silly.

Shall we get over it now please?

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5 thoughts on “Restoring the 50% rate on dividends is essential, but don’t mention Richard Murphy

  1. I thought the top rate of income was 60% but you haven’t mentioned it. Has it been abolished? Does Ed Balls know? Or is it a secret rate, and should I not have mentioned it either?

  2. Murphy

    It’s quite clear for all to see from his insulting treatment of commentators that your imposter alter ego Richard Murphy has obvious anger management issues. Perhaps he isn’t “getting enough” at home, or has had serious disappointments in his career, or maybe living in rural Norfolk makes you stir crazy?

  3. Murphy.

    This is proving a little difficult to understand. Perhaps you could draw a fucking massive mindmap which incoherently ties numerous thoughts together, none of which seem relevant to the original point?

    • That is if I may say a splendid idea! In fact, I wonder if I might make a further suggestion Murphy?

      As a follow-up publication to the groundbreaking State of Courage, which occupies pride of place on my coffee table, would you have the time to produce a book summarising all your Venn Diagrams? I’m sure that, like me, all progressive thinking members of Civil Society have found these to be particularly useful in encapsulating trite left wing ideas in a banal format without the jargon and concepts of economic theory used in commentary by the neo-liberal mainstream media. The marvellous Manchester Guardian being a notable exception here.

  4. surely this complex subject is best explained by one of your Venn diagrams that are not Venn diagrams…perferbly one that has the Pope on one end and Hodge at the other. That should sort the matter out.

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