The UK has a very progressive tax system
YOU’VE heard all the shouting no doubt, that our big problem is that we just don’t tax the rich enough. If only we made the tax system more progressive, if only the fat cats had a larger slice taken out of their paycheques then everything would be lovely. Or better. Or fairer. Or something anyway.
The problem with this is that the UK already has a progressive income tax system. In fact, among the major economies (ie, the G-8, which is the 7 biggest plus Russia) the UK has the most progressive income tax system.
You can also get some interesting information about progressivity from the two charts. A rough measure of that is the difference in the (average) tax rate shown on the two charts. A bigger difference shows a more progressive tax system:
- U.K.: 22.3%
- Italy: 21.1%
- America: 20.7%
- Canada: 20.1%
- Japan: 18.8%
- Germany: 16.6%
- France: 16.2%
- Russia: 0%
Not surprisingly, England tops the list: that’s why all their rock, movie, and sports stars live in other countries.
We are already number one on this measure and we are, as we all know, more unequal than most even after this. So perhaps a more progressive income tax isn’t actually the answer?
And, no, you can’t start talking about Sweden or Denmark either. Their total tax systems are less progressive than the UK’s. They get more of their money from VAT and consumption taxes (which are regressive) than we do.
Posted: 29th, December 2011 | In: Money Comment | TrackBack | Permalink
