This table has just been published by the OECD and shows the "tax wedge" taken from employment earnings for all 34 OECD countries.
Richard Murphy is the founder of the Tax Justice Network
This table has just been published by the OECD and shows the “tax wedge” (the difference between before-tax and after-tax earnings) taken from employment earnings for all 34 OECD countries:
The OECD say of this:
Note then that this “wedge” includes employer’s national insurance – which most people do not appreciate is paid on their behalf.
The UK is at 32.3 per cent, well down the list.
Of course, that may also be why we have such a high deficit: we are undertaxing high earnings in particular.
But there’s no case for saying we’re overtaxed, most especially at high rates. That’s for sure.
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11 Responses to “For those who argue people are overtaxed in the UK and will run away if rates aren’t cut”
OldLb
You’ve missed the point.
High tax – yes, you can spend like Germany.
However, you can also tax like Switerland, New Zealand or Korea, and there isn’t a huge difference in the economies or the level of services.
Why should the cost of services in the UK and Germany be almost twice the other countries? They do not get a Somalia level of infrastructure.
What it means is that the UK and the German governments are overcharging their citizens for what they provide.
OldLb
All company taxes, are paid by people. It’s just that its indirect. Either the customers, the shareholders or the employees are being taxed indirectly.
You need to add on the VAT, the fuel, the insurance premium tax etc, to get a level of how much we are taxed.In fact because of the first paragraph, its tax / number of taxpayers to get a real sense.
Equally, spending per head, 11K is an interesting measure. Since that needs a salary of 40K to pay, it shows that a lot of migration is not beneficial. It also shows we are spending way more than we earn. Living above our means.
Lastly, the debt per tax payer, pensions included, is well over 250,000, rising with inflation. With median wage at 26K, its clear what’s going to happen. The only question is how long.
Anthony Masters
I agree that tax incidence does mean that all company taxes are paid out of the wallets of human beings.
The data in the article only deals with the direct taxation of average incomes, so the author cannot make claims about the overall burden of taxation or the burden on those of higher incomes.
I also agree that government spending and taxation per capita are certainly better measures of government’s size than this specific ‘tax wedge’.
LB
So the argument put forward that we aren’t overtaxed goes like this.
If we ignore all these taxes that people pay, they aren’t over taxed.
Pretty pathetic bit of lying isn’t it?
The real problem is the other huge lie about government debts.
Namely they don’t report the pensions debts. Makes it all look affordable – maybe. Gives people the false security they will get something for their contributions. Given those debts are 500% of the borrowing figure, its not a case of won’t pay, its a case of can’t pay.
That’s disasterous for most people
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