Tax paid exceeds the minimum wage

A report in the Daily Telegraph finds that taxpayers each contributed over £7 an hour to the Treasury in the form of personal taxes last year - a figure higher than the minimum wage. The tax base is shrinking as more people experience unemployment and the number of business failures rises. This puts increased pressure on remaining taxpayers to stump up the cash to pay for government spending. Given the cavernous gap between state spending and tax receipts, we are fast reaching an inflexion point when millions of taxpayers say enough is enough. The rising tax burden must eventually have a negative impact on work incentives and on enterprise. Indeed the Treasury seem to have recognised that the recent hike in top rate taxation to 50% for high income earners will bring little or no extra tax revenue - certainly compared to the £175bn (+) budget imbalance.

“Presuming each of the 29.3 million taxpayers in the country works an eight-hour day, and takes the standard four weeks off plus bank holidays, they contributed on average £7.27 for every hour that they worked. In the previous year, 31.6 million taxpayers contributed £6.63 an hour.”

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