Taxation of Families Report
In March 2023 the Office of Budget Responsibility said that the tax burden was set to rise to a post war high. In 1990 when independent taxation was introduced no nurses and only 5% of teachers paid the 40% higher rate. By 2028 one in eight nurses and one in four teachers are expected to be higher rate tax payers.
A new review of the taxation of families by Tax and the Family says that people with children will be the worst affected as tax liabilities are not based on their household incomes and as result they are already bearing a disproportionately high share of the tax burden. Many moreover and cannot increase their household incomes as the Treasury taxes back almost 70% of any new earnings – sometimes more. There is all too little understanding of the problems so many families face.
At a time when the tax burden is going to be so high it is more than ever necessary, the report says, that the tax burden should be shared fairly. At present it is not. It is vital Tax and the Family say that any tax cuts that are made are focussed on these taxpayers.