Government figures have revealed that five per cent of people pay more than half of the UK’s tax, and experts warn that this uneven burden puts the economy at risk.
The figures show that, for the first time, the wealthiest workers in the UK, who earn more than £75,300 a year, contribute to more than 50 per cent of the income tax collected by HM Revenue & Customs (HMRC).
The analysis revealed that the proportion of income tax paid by the top five per cent was 39.6 per cent 20 years ago, but it is expected to be 50.1 per cent this tax year. At the same time, their proportion of total earnings before tax has remained almost static, growing from 23.3 per cent to 25 per cent.
According to some commentators, the taxman’s targeting of this group is dangerous, as these people tend to be “highly mobile” and could move abroad to pay less tax, with one remarking that the tax base has become too narrow. He added that allowing a small number of better-off people to shoulder the cost of public services is a “risky policy, politically and economically”.
Meanwhile, another said that, while people criticise higher earners about their income, almost nobody realises that high earners pay a disproportionate amount of income tax.
A spokesman for the Treasury said that, since 2015, 1.74 million of the lowest-paid workers have not had to pay income tax. He added that anyone earning between £10,600 and £100,000 has benefitted from the increase to the personal allowance and even higher earners are £495 better off a year because of the increases to the higher rate threshold.
