Home Business News This week’s Autumn Statement: Why letting the rich foot even more of the bill is a risky balancing act

This week’s Autumn Statement: Why letting the rich foot even more of the bill is a risky balancing act

by LLB Finance Reporter
15th Nov 22 10:39 am

The top 100 taxpayers in the UK – a minuscule proportion (0.0003%) of all taxpayers – pay a staggering £3.831 billion a year in income and capital gains tax.

That’s £38 million each on average and nearly 2% of HMRC’s total annual revenue from these two taxes. This is according to new data received through a Freedom of Information (FOI) request made by investment service Wealth Club to HRMC.

The Chancellor needs to find an estimated £55 billion to plug the shortfall in public finances and it’s widely anticipated he’ll announce some £25 billion worth of tax rises on Thursday with wealthier individuals shouldering much of the burden.

Alex Davies, CEO and Founder of Wealth Club said, “It is commonly accepted that those with the broadest shoulders should bear the greatest burden. But what many people do not realise is: they already do – and have been doing so for years.

The top 100 taxpayers in the UK paid over £3.83 billion in income and capital gains tax last year which is sufficient to pay the average wage of 36,926 NHS consultants or over 112,000 nurses. The top 100,000 meanwhile paid over £45.53 billion.

So, as Jeremy Hunt looks to plug the black hole in our finances this Thursday, he needs to tread carefully. The country’s tax receipts are very dependent on a frighteningly small number of rich people. Even if only a handful of the top 100 paid less in tax – or stopped paying altogether – it could be disastrous for the country’s finances.

And that’s not a remote possibility. The wealthy have more options available to them. The drastic one is leaving the country, the other is to concentrate even more on arranging one’s affairs as to pay as little tax as possible.

As Louis XIV’s finance minister said ‘the art of taxation consists in so plucking the goose as to obtain the largest possible amount of feathers with the smallest possible amount of hissing’. The Treasury needs to be careful that the relatively small number of geese that it is plucking don’t begin to hiss too loudly.”

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