Record 1.6 Million Paying 40 Percent, Top Rate Tax
A record 1.6 million people are paying the top rate of tax, first intended to tax Britain's big earners. A quarter of all teachers and a third of police officers are now paying the tax, according to the Daily Mail. Earners over £41,865 are now paying the tax, even though this is not considered to be a large income.
Many taxpayers over this level do not consider themselves rich, and are unhappy that they are being dragged into the top rate.
The news will put pressure onto the Conservatives to pledge an increase in the threshold as part of their manifesto for next year’s General Election. David Cameron had previously said that he would “love” to increase the threshold and take large numbers of taxpayers out of the higher rate. But critics have claimed that this “fiscal drag” which constantly pushes more people into the tax has been highly lucrative to the Treasury.
Figures from the Office for National Statistics reveal that 120,000 teachers, 70,000 police officers and up to 72,000 nurses have been pulled into the 40p band. The Office for Budget Responsibility claims that one in three workers will be on top rate within the next decade unless changes are made, twice as many as at present.
Douglas Carswell, MP for Clacton, said: “Where did Margaret Thatcher go? I thought we had sorted all this out in the 1980s, when we wanted less government and for people to keep all their money. If you had said 20 years ago that we would be paying these sorts of tax rates, you’d have thought Michael Foot had won the election. Who is arguing for lower taxes now?"
In April, the Chancellor George Osborne used his Budget to increase the tax-free personal allowance from £10,000 to £10,500, a change that the Treasury says benefits all workers earning up to £100,000. As previously reported on Breitbart London the UKIP Manifesto is likely to include a commitment to raise the top rate threshold to £45,000, taking a large number of workers out of the tax.
A total of 87,000 secondary school teachers are paying top rate, and 34,000 primary school teachers. In 2003 no nurses paid the top rate of tax but this year there are 72,000 who do, alongside 5,000 paramedics. Outside professional jobs, 10,000 electricians are paying the tax. This shows that increases in tax bands are not keeping pace with wage inflation.
The 40 percent band is not the only tax that has increased in recent years, council tax doubled under the last Labour government. Statistics show that the average family was paying an extra £720 a year by the time the Labour government left office in 2010.