UK taxes at historical high

15 Nov 2019

UK taxes are at a historical high, accounting for over a third of GDP at 34.4% and up almost seven percentage points from the 1950s, according to a new Institute for Fiscal Studies (IFS) report.

In the 1950s, taxes accounted for just under a third of GDP at 27.5%, which was £5.8 billion. Since then, tax revenue rose to £627.9 billion in 2018/19. This is forecast to rise further in 2019/20 to £757 billion, equivalent to a per capita GDP contribution of £14,000 per adult.

According to the IFS, the top 1% of the adult population now pays well over a third of all income tax, while only 58% of UK adults are liable for income tax.

The IFS said that policy reforms since 2010 have increased tax revenue by around £20 billion overall, despite large giveaways increasing the income tax personal allowance, cutting the headline rate of corporation tax and freezing fuel duties. Tax-raising measures, including rises in VAT and national insurance contribution (NIC) rates, exceed these giveaways overall in revenue terms, the IFS added.

Commenting on the report, Stuart Adam, Senior Research Economist at the IFS, said: 'Taxes in the UK are not high by international standards, but they are high by historical standards: almost 35% of national income, the highest sustained share since the 1940s.

'And our tax revenues are ever more reliant on a small group of high-income taxpayers. It is average earnings, rather than top earnings, that would be taxed markedly more if the UK adopted the tax system of a typical higher-tax country.'

Register for our newsletter

Once a month we'll send you an email packed full of essential business news and handy tax tips to help save you money.



34 Boulevard
BS23 1NF

01934 415022


Bath Street
BS27 3AA

01934 743274

Home | Contact us | Accessibility | Disclaimer & Privacy Policy | Help | Site map |

© 2020 Four Fifty Partnership. All rights reserved.

We use cookies on this website, you can find more information about cookies here.

Registered to carry on audit work in the UK by the Institute of Chartered Accountants in England and Wales. Details about our audit registration can be found at under the reference C001092613.

"four fifty partnership" is a trading name of Four Fifty Partnership Limited. Registered in England. Company Number 5032008. Registered Office 34 Boulevard, Weston super Mare, Somerset BS23 1NF.

Directors: Richard Acreman BSc CTA, Joy Boswell FCCA FCA, Peter Ison BA FCA and Nick Gravell FCCA FCA.

Professional Indemnity Insurers: Nexus Underwriting Limited 52-56 Leadenhall Street, London EC3A 2EB (Policy Number: BC6210PIA194). The territorial coverage is worldwide excluding professional business carried out from an office in the United States of America or Canada and excludes any action for a claim brought in any court in the United States of America or Canada.