30th May- Tax Freedom Day
The Adam Smith Institute has announced that this year “Tax Freedom Day” will fall on 30th May.
Each year the Institute calculates the date they claim you stop working for the Government and start working for yourself.
The free market think tank says that this year Tax Freedom Day is six days later than in 1997 and five weeks later than in 1964.
The date is calculated by comparing the Budget’s predictions of national income against the total amount raised in taxes.
Under the category of taxes it includes income and council tax as well as national insurance and VAT paid on goods.
Estimating that the tax take is around 42 per cent of national income, the Institute argues that individuals have to spend 42 per cent of the year working solely to pay taxes.
The measure though does not take any account of the services received from taxes, for example health and education or money recieved back in the form of tax credits or benefits.
The director of the Adam Smith Institue, Dr Eamonn Butler, said: “It is astonishing that Gordon Brown has managed to make us all put in six days more work for the Treasury without many people noticing,”
“It is a tribute to his skill at dreaming up new stealth taxes. But he cannot escape Tax Freedom Day, which is a straightforward and clear indicator of just how much time we spend working to pay our taxes.”
In the Eurozone the Institute calculates that Tax Freedom Day falls a month after the British date. This is contrasted to America, where it falls on 11th April.
The Adam Smith Institute argues that governments should work towards low tax economies, which they say leads to higher economic growth, employment and prosperity.
