Today is Tax Freedom Day

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It's here at last. Yes, today is Tax Freedom Day - that wonderful point in the year when the average taxpayer has finally earned enough to cover all their taxes and at last can start earning for themselves. 

It may come as a shock that the average UK resident has spent the last 155 days working solely to support government expenditures, but that is the reality of it. More than two-fifths of an average earner's wages is taken from them in taxes. So when people joke that they spend as much time working for the taxman as they do for themselves, it is very nearly true.

Of course, it wasn't always like this. When Gordon Brown became chancellor in 1997, Tax Freedom Day was May 26 – a whole week earlier. And if you go back to 1965, Tax Freedom Day came on April 27!

Unfortunately, the true picture could be even worse than our figures suggest. Last year Tax Freedom Day actually came three days later than forecast, because the economy grew more slowly than the government expected. The signs are that 2008 could be no different. And if government borrowing is factored in, Tax Freedom Day does not come until June 14.
 
Government spending will reach £600bn in 2008. That's £10,000 for every man, woman and child in the UK  – and twice as much as when Gordon Brown became Chancellor. If he had only raised public spending in line with inflation, he could have abolished income tax, corporation tax, capital gains tax and inheritance tax by now – leaving the taxpayer some £200bn better off. Something to think about, perhaps...

Anyway, a Happy Tax Freedom Day to you all!