According to HM Revenue and Customs (HMRC), the 1.13 million individuals paying the 45p rate are expected to contribute £124 billion this year, which represents more than 40% of all income tax collected by the Treasury. This underscores the growing reliance of the UK government on a small number of top-rate taxpayers for significant portions of its income tax revenue.
Labour's Rachel Reeves is facing pressure to reassess her planned tax increases on non-doms and higher earners after Treasury officials warned that targeting a small group of top earners could yield less revenue than anticipated, highlighting the potential risks associated with heavily taxing this demographic.
Carl Emmerson, deputy director of the Institute for Fiscal Studies (IFS), cautioned that heavily taxing a small group of individuals could prompt changes in their behaviour, making it a 'riskier strategy,' indicating potential complications in tax revenue projections for the government.
Sir Keir Starmer has emphasised that those with the 'broadest shoulders' must bear the heaviest burden as Labour prepares for a 'painful' budget on October 30, showcasing the party's stance on progressive taxation in light of the growing fiscal challenges.
Collection
[
|
...
]