The average family pays £656,000 in tax over their lifetime
The TaxPayers’ Alliance (TPA) shows that the average family pays £656,000 in tax over their lifetime.
After years of the state overspending and misusing our money we now have a greater idea of how far this legacy cripples the finances of British families. The TPA’s latest research shows the total amount of direct and indirect tax that households will pay over their working lifetimes and in retirement. Based on the current level of taxes applying over a working lifetime of 40 years and 15 years of retirement the key findings of their research are:
- The average household will pay over their lifetime a total of £250,000 in Income Tax and £101,000 in VAT;
- Poorest households are hit hardest by VAT and Council Tax. A household in the lowest quintile pays £57,000 in VAT and £55,000 in Council Tax over a lifetime;
- An average household in the lowest income quintile will pay £235,000 in direct and indirect taxes;
- An average household in the second income quintile will pay over £392,000 in direct and indirect taxes;
- An average household in the third income quintile will pay over £556,000 in direct and indirect taxes;
- An average household in the fourth income quintile will pay over £755,000 in direct and indirect taxes; and
- The four most burdensome individual taxes over a lifetime are Income Tax, VAT, employee National Insurance contributions and Council Tax.
Matthew Sinclair, Director TaxPayers’ Alliance said:
Households in the UK now pay an incredible amount in tax over a lifetime, handing over a hefty slice of their income. The VAT hike has added to the cost of living and many taxpayers are really feeling the pinch with little prospect of improvement on the horizon. The Chancellor needs to deliver a tax cut in the Budget, to ease the burden and help the economy to grow. Simpler, fairer taxes can decrease the lifetime tax bill for households and leave everyone with more of their own money, so they can decide how to spend it.
When the poor are hit so heavily through taxation it is impossible to view current levels of taxation as fair and just. That is why we need lower, simpler taxes.
Last year, the Government delivered the biggest single increase of personal allowances in income tax history. The amount that can be earned before income tax rose from £6,475 to £7,475 in April 2011, which took 880,000 people out of the income tax system altogether. This year, the Government plans to increase it to £8,105. However, we need to go further.
I repeat the call that I made recently in correspondence with constituents:
For far too long, Governments have got away with making promises which could only be funded by excessively high taxes, immoral borrowing and damaging inflation. No other organisation would be allowed to get away with it and neither should government. More than that, I want to see lower taxes across the board. As a Conservative, I believe that less government, less tax, more freedom and more responsibility are elements of the right recipe to create a better society for everyone. I want radical change.
