The least well off households pay 36.6 per cent of their income in tax compared to 35.5 per cent paid by the wealthiest.
Boris Johnson has a piece in today’s Telegraph in which he claims that we should be ‘humbly thanking the super-rich, not bashing them’.
“the latest data suggest that we should be offering them humble and hearty thanks. It is through their ]the rich’s] relentless concupiscent energy and sheer wealth-creating dynamism that we pay for an ever-growing proportion of public services.”
In other words, the rich are heroes and should be treated as such because they pay a vast amount of tax. The top 0.1 per cent pay an “amazing 14.1 per cent of all taxes”, according to Boris.
The rich do pay a high percentage of the treasury’s total tax share. The problem with Boris’ logic, however, is that it ignores one important fact: the poor pay a higher tax rate than the rich.
According to recent analysis by the Office for National Statistics, the least well off households pay 36.6 per cent of their income in tax compared to 35.5 per cent paid by the wealthiest.
This is partly down to the fact that VAT – which George Osborne put up in 2010 from 17.5 per cent to 20 per cent – hits the poor disproportionately compared to the rich. Low income families spend around 12 per cent of their disposable income on VAT, compared with 7.6 per cent for average households and 5.9 per cent for highest earners.
So while the rich may pay a lot of money in tax, as a proportion of their income it’s actually less than that paid by the poor.
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