By Joseph Willits
Follow Joseph on Twitter
According to new research based on National Statistics data from the TaxPayers' Alliance, over the course of a lifetime the average household pays £656,000 in tax. This includes £250,000 in Income Tax and £101,000 in VAT.
The Taxpayers' Alliance's figures are based on the current rate of tax, calculated from a working life of 40 years and 15 years of retirement. The research is broken down in to quintiles, which are broken down into five household income groups, ranging from the highest to the lowest. Some of the key findings of their research are:
- £1.3 million in direct and indirect taxes will on average will be paid by households in the highest quintile. The figure for the lowest quintile is £235,000.
- Figures for the second income quintles are £392,000; third – £556,000; and fourth – £755,000.
- The taxes which are most burdensome to all households are Income Tax, VAT, employee National Insurance contributions and Council Tax.
- For the poorest households (those in the lowest quintile), this means paying an average of £57,000 in VAT, and £55,000 in Council Tax.
Responding to the findings, Director of the TaxPayers' Alliance Matthew Sinclair has said:
"Households in the UK now pay an incredible amount in tax over a lifetime, handing over a hefty slice of their income. The VAT hike has added to the cost of living and many taxpayers are really feeling the pinch with little prospect of improvement on the horizon. The Chancellor needs to deliver a tax cut in the Budget, to ease the burden and help the economy to grow. Simpler, fairer taxes can decrease the lifetime tax bill for households and leave everyone with more of their own money, so they can decide how to spend it."