The total income tax paid by high earners making £150,000 or more has increased by 77% in the last decade, reaching £60.9bn in the 2019/20 tax year, up from £34.5bn in 2010/11, reports national accountancy group, UHY Hacker Young. Over the same period the total tax take from basic rate taxpayers has fallen 5%, from £68.6bn to £64.9bn, as HMRC becomes increasingly reliant on those paying the additional rate of income tax. 32% of all income tax HMRC receives is now paid by those earning £150,000 per year or more, compared to just 23% ten years ago.
Neela Chauhan, private client tax partner at UHY Hacker Young says: ‘There has been a clear effort from HMRC to shift their focus onto higher earning taxpayers. As more people are being pushed into the top tax bracket, the government needs to act quickly to ensure more taxpayers aren’t unfairly squeezed. Moving all the income tax brackets upwards in line with inflation would be a reasonable first step.’
‘There are concerns that a slow leakage of top earners leaving the UK may hinder the UK’s economic recovery over the long term. The UK was seen as a low-tax regime within Europe but with rising NI and fiscal drag that position is being gradually eroded’, she adds.
The total income tax paid by high earners making £150,000 or more has increased by 77% in the last decade, reaching £60.9bn in the 2019/20 tax year, up from £34.5bn in 2010/11, reports national accountancy group, UHY Hacker Young. Over the same period the total tax take from basic rate taxpayers has fallen 5%, from £68.6bn to £64.9bn, as HMRC becomes increasingly reliant on those paying the additional rate of income tax. 32% of all income tax HMRC receives is now paid by those earning £150,000 per year or more, compared to just 23% ten years ago.
Neela Chauhan, private client tax partner at UHY Hacker Young says: ‘There has been a clear effort from HMRC to shift their focus onto higher earning taxpayers. As more people are being pushed into the top tax bracket, the government needs to act quickly to ensure more taxpayers aren’t unfairly squeezed. Moving all the income tax brackets upwards in line with inflation would be a reasonable first step.’
‘There are concerns that a slow leakage of top earners leaving the UK may hinder the UK’s economic recovery over the long term. The UK was seen as a low-tax regime within Europe but with rising NI and fiscal drag that position is being gradually eroded’, she adds.
