Some interesting facts and figures recently emerged from HMRC on the narrowness and fragility of the UK tax base report Harris & Co accountants Northampton as part of their innovative accountancy services to Northampton businesses.
There are 30 million taxpayers in the UK.
In the recent past, the burden of UK taxes has increasingly been past to the highest earners. In 1979, the top rate of tax was 83% and the top 1% of earners contributed 11% of all income taxes.
Today, the top rate of tax is 45%, but the top 1% of earners now contributes 30% of all income taxes.
In 1979, the top 10% of earners contributed 35% of all income tax. Now the same percentage contributes 55% of all income tax.
Worryingly, though, the top 1% of earners number only 300,000 people – the equivalent to the population of Nottingham.
Even more concerning, the very top 0.1% of high earners – just 30,000 people – contribute 14% of all income tax.
The UK tax base is reliant on a very small number of people and if they were to ever leave the UK we would all face massive increases in income tax.
At the other end of the scale, 50% of taxpayers pay only 10% of all income tax. For those on average earnings of about £25,000 per annum, the figures indicate that the amount that they contribute in income taxes is less than what they draw out of public services.