Tax Freedom Day 2013
If you felt a spring in your step on 30th May it might have been because that was “Tax Freedom Day” for 2013. I’ve discussed this in earlier years but it’s worth another visit.
It’s a somewhat artificial measure of how much we are taxed in the UK and is computed by ‘think-tank’ The Adam Smith Institute. They look at how much tax (of all sorts, income tax, VAT, NIC etc.) the Government take off us and calculate it as a share of the UK’s national income. That share amounts to 41.5% or 150 days or (if you imagine paying all the tax upfront) imagine paying everything you earn to the Government from 1st January to 30th May and then keeping everything you earn after that.
It works on averages of course, if you pay more tax than average it will take you longer to reach tax freedom day.
Whilst artificial it can serve as a useful measure of which way the tax burden is going and sadly it’s going the wrong way. Last year Tax Freedom Day was May 29th and this year’s date is the latest in the calendar since 2006. As a nation, we are paying more in tax whilst, as we are told, the Government is trying to cut spending. Quite how this is happening is anyone’s guess!
In the US and Australia, they have it a bit better. Their tax freedom day falls in mid-April but spare a thought for the French who don’t have tax freedom day until some time in July. But a real idea about how much Government spending in some countries has grown can be found in historical data which shows that in 1910 the USA celebrated tax freedom day on January 19th!Talk to Barnes Roffe today