UK Tax payment totals and where the money is spent
Archive - Originally posted on "The Horse's Mouth" - 2005-05-27 07:25:53 - Graham Ellis
In looking up information for a post I was making elsewhere, I've been researching taxation levels in the UK - seeing how much government is spending on our behalf. And it's been suprisingly hard to get an overall picture. Do YOU know how much tax you pay in total (Income tax, NI, VAT, Petrol duty, road fund license, council tax, stamp duty, inheritance tax, etc) per year? Is that above or below average?
Central government is spending ("managed expediture") 520.8 billion in the 2005-2006 year. Council tax on 23.2 million properties will average 1015 pounds per property. Business rates provide further local taxation - but I've not come up with any reliable stats; my best estimate is (27/40) [East Sussex] of the amount of council tax or (26/59) [Waverley] or (28/42) [Neath / Port Talbot] (Sources - these council's web sites). And when is government income not taxation - is a fee paid for a Visa a tax? How about a prescription charge? How about rent paid for a council house? Lots of conundrums but ...
How much is central and local government spending per annum?
Central Government - 520.8 billion projected for 2005/6
Local Government - my estimate is an EXTRA 37 billion from council tax and business rates alone
Note - care taken not to "double count" central government's grants to local government
So with a population of 60 million, that means they're spending 9297 pounds per head of population - per man, woman or child. If you're a family of Mum, Dad and two kids, that's 37188 pounds.
Where does this income come from
Mostly you and me. In other words, that same 60 million people. We're a net contributor to the EU of around 4 billion pounds a year, so there's no income source there. I suspect we don't receive significant aid from foreign governments. There is a tax income (VAT and other purchase taxes like fuel duty) from tourists. Borrowing to spend (the National Debt) is just delayed expenditure from the same sources, and business taxes such as Corporation tax are also paid by us in the form of higher prices that we pay companies for goods and services.
Is the money spent wisely and well?
Ah - the move from facts and figures to views and subjective questions. I don't know. I started putting these figures together when reading a discusssion / argument concerning a mother of three teenage girls, each of whom is now a mother too, with all 7 of them living in a three bedroomed house provided by the government ... and on a total income (said to be their only income) from the taxpayer of 31000 per year.
The discussion has moved on to cover people who take the attitude that "I pay tax and therefore it's my right to have the state provide for me". And perhaps the other questions could be asked like "why should you expect the state to pay for the education of your children when you chose to have them ...?" ... to which question, I must admit, there ARE some very good answers.
Of the 8680 pound spend by central government on your behalf this year ...
1120 pounds will go to the NHS
763 pounds will go to local government (to help towards services such as police and education)
520 pounds will go to regional expenditure on Scotland and Wales
440 pounds will go to education
343 pounds will go to defence
135 pounds will be spent on Northern Ireland
75 pounds will go on international development
and 4200 pounds can't be accurately assigned as it goes on demand lead costs such as social security payments (state pensions - roughly 1000 pounds spend for each of us according to the pensions commission - but also unemployment benefit, disability benefit, etc)
Sources - treasury and budget reports and spending plan documents except where otherwise noted.