How your income tax bill has gone up

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Independent research shows that our highest earners ae paying an increasing proportion of our tax receipts.

The Institute for Fiscal Studies (IFS) is an independent body that has established a reputation for objectivity in tax matters. Its former head, Robert Chote, is now in charge of the Office for Budget Responsibility (OBR), which vets the Budget numbers.

Recently the IFS looked at how the pattern of income tax payments has changed over the years and would change further by 2020. It drew some interesting conclusions:

Graph showing percentage of total income tax paid against tax years

The IFS findings and predictions suggest that there will be little respite in the trends identified as the result of government action. If anything, the opposite is true, because income tax is projected to rise as a proportion of total government revenues. As ever, if you want to reduce your tax bill, the answer lies in your own financial planning, not the Chancellor’s.

The value of tax reliefs depends on your individual circumstances. Tax laws can change. The Financial Conduct Authority does not regulate tax and trust advice.

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