Would you be happy to give away more than half your salary in Tax? No…of course not, no matter how much you earn!
I find it amazing that politicians and the media continue to mislead people in the UK about how much tax richer people pay. Even if there was not a tiered tax scale a percentage of salary…means you pay more tax the higher your salary. Simple!?
However, as the UK has ever increasing tax bands, people who get paid more…get taxed even more!! These pie charts (thanks to http://www.thesalarycalculator.co.uk) illustrate this.
Remember, this is just the tax we all pay before spending our money on VAT ‘able item. Which will add another 20% tax. As wealthier people generally spend a greater percentage of their earnings on VAT ‘able luxury items, (i.e. basic groceries and non-VAT ‘able items are a smaller fraction of their spending than less well off people) again the percentage of salary paid in VAT is greater.
Put simple anyone earning over about £100,000 is looking at forking out half their earnings in Income Tax, NI and VAT!! No wonder people try so hard to find ways to get out of this.
Not to forget all the other taxes, such as alcohol (~48p per pint of beer), petrol (~58p per litre), insurance premiums (between 4% and 20%…yes you get taxed when you insure your car or dishwasher!!!) etc..
Total Taxes: 8.5% of salary
UK average Salary
Total Taxes: 21.4% of salary
Member of Parliament Salary
Total Taxes: 31.5% of salary
Prime Ministers Salary
Total Taxes: 39.6% of salary
Seriously Rich Guy
Total Taxes: 44.8% of salary
RBS Chief Exec
Total Taxes: 46.5% of salary
Total Taxes: 48.8% of salary