‘Tax freedom day’ falls on 31st May

This year’s Tax Freedom Day, the day when Britons stop working to pay their taxes and start earning for themselves, falls on 31st May, according to Adam Smith Institute calculations.

The Institute estimates that Britons will work 150 days this year solely to pay their taxes. This is one day later than 2014′s Tax Freedom Day, which is not statistically significant. However, the UK’s Tax Freedom Day falls more than a month later than it does in the United States, where citizens started earning for themselves on 24th April.

Tax Freedom Day is designed to reveal to the public how much they really pay out in taxes, which Britain’s lengthy tax code can often obscure. The Institute’s calculations include all taxes raised by HMRC: direct taxes like income tax, national insurance and corporation tax, and indirect taxes like VAT and excise duties.

Cost of Government Day, which represents ‘Total Managed Expenditure’ as a day of the year, falls on 29th June, three days earlier than it fell in 2014. While this suggests a slight improvement over last year, the money borrowed to cover the month-long gap between Tax Freedom Day must eventually be paid off with future taxes. This means without tax cuts or major growth Tax Freedom Day would eventually have to drift even later.

Director of the Adam Smith Institute, Dr Eamonn Butler, said: “The Treasury hates Tax Freedom Day, because they don’t want us to know how much tax we really pay. They prefer to conceal the tax burden through stealth taxes and indirect taxes that we don’t even realise we’re paying.

“Most people are shocked to learn that the government takes over two-fifths of the country’s earnings – and then borrows more. Mediaeval serfs had to work about a third of their time for their feudal lord, but we are in serfdom to the government for even longer

“High taxes are very bad for economic growth, as talent and initiative drain abroad. Ask President Hollande of France.”