Britons Toil Longer To Pay Their Taxes

by Jason Gorringe, Tax-News.com, London

07 June 2004

May 30 was a significant date for most Britons this year, as it was the day they effectively stopped working for the government and began drawing from their own pay, in what has become known as Tax Freedom Day.

This means that every penny earned by the average British worker up to that date has been needed just to pay taxes, according to the Adam Smith Institute, the free-market think-tank which calculates the date each year.

And according to the Institute, this date has been falling later and later since the present government came to power in 1997, when Tax Freedom Day arrived on May 25.

“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”, commented the Institute’s director, Dr Eamonn Butler.

To calculate the date, the Institute compares the Budget predictions of national income against the total amount raised in taxes. And since the tax take is about 42% of national income, it means people have to spend 42% of the year working solely to pay taxes.

The man behind the tax freedom day calculation, City economist Gabriel Stein, explained: “People often joke that they spend as much time working for the government as they do for themselves. But unfortunately it is getting nearer and nearer to the literal truth. Tax Freedom Day enables people to see how near to the truth it really is.”

However, compared to taxpayers in the eurozone the British get away relatively lightly. There, in 2002 (the last available figures), tax freedom day did not fall until June 28. Meanwhile, across the Atlantic, US taxpayers celebrated freedom from taxes on April 11, the earliest date in 37 years.

Still, those Britons old enough to remember may look back wistfully to the good old days of 1964, when England’s cricketers weren’t routinely humiliated by the Australians and one worked a full five weeks less to pay off one’s taxes.

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