Taxation of Families 2011 - International Comparison by CARE User

The Taxation of Families – International Comparisons 2011

CARE RESEARCH PAPER

the taxation of families – international comparisons 2011

Foreword by Rt. Rev Dr Peter Forster, the Lord Bishop of Chester

by Alistair Pearson and David Binder Fiscal Policy Consultants 1

CARE 53 Romney Street / London SW1P 3RF 020 7233 0455 mail@care.org.uk www.care.org.uk CARE is a registered charity, Number 1066963, Scottish Charity Number SC038911 and a company limited by guarantee Number 3481417

contents Preface

Foreword

Acknowledgements

Executive Summary

Chapter 1 – Introduction

p11

Chapter 2 – Tax Systems in OECD Countries

p13

Chapter 3 – Comparison of Tax Burdens

p16

Chapter 4 – Comparison of Marginal Effective Tax Rates

p27

Chapter 5 – Conclusions

p33

Annex – Comparison of Income Tax Burdens

p35

Appendix A – Tax Systems in OECD Countries 2011

p40

Appendix B – Tax Burden 2000-2011

p43

Appendix C – Tax Burden by Family Type and Wage Level 2011

p44

Appendix D – Tax Burden on Families Compared with Singles without Children 2011

p45

Appendix E – Marginal Effective Tax Rates 2011

p46

preface I am delighted to present you with The Taxation of Families - International Comparisons 2011. This report examines how UK families fare in comparison to their OECD counterparts in regard to the tax burdens and Marginal Effective Tax Rates they face.

A New Approach In previous years, our annual Taxation of Families report has examined the way in which the UK tax burden has been shared between those with and without family responsibility, both in comparison with the rest of the OECD, and from a purely domestic perspective. In the interests of providing more focused and detailed analysis of each, however, we have decided that from now on we will produce two separate publications, one addressing the international comparison - of which this is the first - the other looking at the taxation of families in the UK from a domestic perspective. The first edition of the latter will be published early in 2013.

Key Headlines from The Taxation of Families - International Comparisons 2011 This publication demonstrates that the tax burden on one-earner married families for 2011 was 42% greater than the OECD average in 2011. Moreover, if we look at the income tax finally paid by households on a comparative basis we find that UK one-earner households on an average wage were well out of line, with an income tax burden that was 67% greater than the OECD average. In short, our tax system remains very individualistic and insensitive to family responsibility, compared to most OECD countries. The tax burden placed on a one-earner married family with two children on average wage, as a proportion of that placed on a single person on the same wage with no family responsibilities, was 73% in 2011 when the comparable OECD figure is just 52%. The Taxation of Families - International Comparisons 2011 also shows that UK Marginal Effective Tax Rate levels on both one-earner couple families and lone parent families still remain well out of line with the developed world, changing very little since 2010. At 36% - that is the UK minimum wage - 50% and 75% average wage, Marginal Effective Tax Rates in 2011 were far in excess of the OECD and European averages. Hence, these families that are most in need of financially rewarding work only saw 27 pence of every extra ÂŁ1 earned go to the household. This is hardly evidence of an â&#x20AC;&#x2DC;aspiration nationâ&#x20AC;&#x2122; at work.

Given that, as noted in the conclusion, recognising marriage in the tax system, as promised by the Coalition Agreement, would help bring the UK back into line with its international counterparts and go some way to address the problems highlighted by this publication, it is very unfortunate that the Coalition Government still has not introduced the necessary legislation. In truth, time is now running out. Leaving the change any later than the March 2013 Budget would provide insufficient time for the new arrangement to get properly up and running before the General Election. The Government, therefore, must now prioritise implementing its marriage commitment in Budget Resolutions immediately following the 2013 Budget. I warmly commend The Taxation of Families - International Comparisons 2011 to you, trusting that it will be read and re-read by policy makers and really help the Government to fulfil its noble commitment to â&#x20AC;&#x2DC;make Britain the most family friendly country in Europe.â&#x20AC;&#x2122;

Nola Leach Chief Executive and Head of Public Affairs, CARE December 2012

foreword This report, which is concerned with international comparisons, is the sixth review of family taxation that CARE has undertaken. It has been my privilege to host the launch of a number of the previous reviews. What has always impressed me is the professionalism of CARE’s work. The evidence they present each year merits careful consideration. The family is the basic building block of society, and we ignore it at our peril. Most other countries do not, but for the last 23 years here in the United Kingdom the income tax system has ignored not only marriage, but also the family. The results are now clear for all to see. The report shows that even when tax credits are taken into account, the tax burden on many ordinary families is still higher than in other countries. At the OECD average wage for the UK of £34,286, a one-earner married couple with two children bears a tax burden that is 42% greater than the OECD average. Moreover, the tax burden on that family is 73% of that placed on a single person on the same wage, whilst the comparable OECD figure is just 52%. The divergence from international averages is not confined to average tax rates. In 2011, a married couple with two children and an income of around £25,000, would have had an effective marginal tax rate of 73%, meaning that the family would have kept only 27p of every extra pound earned. It is not only couples who are caught in this tax trap. So too are single-parent families. I find this deeply disturbing. If 50% is too high a tax rate for the wealthy, why is 73% thought to be acceptable for ordinary families? Effective marginal rates of tax are far higher in the UK than in other OECD countries, many of which have much lower tax burdens on families. If other countries can avoid such high rates, why can’t the UK? We must all render to Caesar what is Caesar’s, but Caesar should not be asking a family of four or five to pay the same income tax as individuals who are responsible only for themselves. It is not a question of subsidising families, but of sharing the tax burden fairly according to people’s ability to pay. And Caesar should not be taking 73p of every extra pound that ordinary working families earn. The review challenges the way in which UK families are taxed. All policy makers need to take note of the international evidence presented, and take appropriate steps to redress the imbalances.

Rt. Rev Dr Peter Forster, the Lord Bishop of Chester November 2012

acknowledgements We again place on record our thanks to the OECD, who publish the data on which our international comparisons are based. We should like to thank Dan Boucher, Director of Parliamentary Affairs at CARE, and Donald Draper and Leonard Beighton, fellow members of CAREâ&#x20AC;&#x2122;s Fiscal Policy Group, for their comments and suggestions. We are grateful to the Bishop of Chester, who has contributed the foreword to this report, for his support and encouragement. We stress that any errors or omissions are entirely our own responsibility, and that the views expressed are our own.

Alistair Pearson and David Binder December 2012

The Taxation of Families – International Comparisons 2011

the taxation of families international comparisons 2011 Executive Summary 1.

This review of the taxation of families uses statistics published by the OECD in Taxing Wages to make comparisons between the UK and other developed countries. It examines the tax burdens on household types at various income points. Following established OECD practice, we define ‘tax’ as income tax plus employee social security contributions less cash benefits. Where we consider the income tax element separately, we use the term ‘income tax’.

International comparisons for 2011, the latest year for which there is OECD data, reveal that the tax burdens of many one-earner UK households compare favourably with the international averages: •

The tax burden on single people without family responsibilities is lower than the averages for the EU(15) and EU(21), and in line with the average for OECD countries.

•

At low incomes (36% and 50% of the OECD average wage), families appear to do better, often significantly so, than their counterparts in other countries.

The tax burden on two-earner couples is in line with the international averages at combined incomes above the OECD average wage, although we have been able to make comparisons at only two income points (133% and 167% of the OECD average wage).

The UK households that compare most unfavourably with their equivalents in other countries are one-earner families on middle incomes. At the OECD average wage for the UK of £34,286, the tax burden on single parents with two children is 30% greater than the 2011 OECD average, and 42% greater on one-earner married couples with two children. The tax burden on these family types is also greater than the 2011 OECD average at 75% of the OECD average wage (£25,715, close to the UK median wage). It is 8% greater for a single parent with two children, and 29% greater for a one-earner married couple with two children.

For single parents with two children on an OECD average wage, the tax burden compared with that of singles without children is 28% greater than the OECDwide average (73% compared with 57%). For one-earner married couples with two children at the same income point, the figure is 40% (73% compared with the OECD-wide average of 52%).

The unfavourable position of one-earner UK families at 75% and 100% of the OECD average wage is caused mainly by the fact that income tax does not take account of marriage or family responsibilities. 9

The Taxation of Families â&#x20AC;&#x201C; International Comparisons 2011

A comparison of income tax burdens reveals the following: â&#x20AC;˘

For single people without children, the UK income tax burden is somewhat greater than the OECD average at low income points, but very similar to it at and above the OECD average wage.

â&#x20AC;˘

For one-earner families, UK income tax as a percentage of gross wages is greater than the OECD average at all income points. The disparity is greatest for low income families. For one-earner married couples with two children, the UK income tax burden is also greater than the EU(15) and EU(21) averages at all income points.

UK tax credits compensate low income families for the heavy income tax burden, such that their overall tax burden is low by international standards. But for many families with modest incomes, the overall tax burden remains greater than the OECD and EU averages. The tapered withdrawal of UK tax credits is largely responsible for high marginal tax rates across a wide income range.

UK marginal effective tax rates (METR), which take account of income tax and employee social security contributions payable and cash benefits foregone, are almost twice as high as the OECD and EU averages at the 36%, 50% and 75% income points.

10.

Disparities in UK tax burdens have their origins in tax policy that has evolved over a long period. We intend to publish a more detailed review of the taxation of UK families, drawing on UK data sources, in the Spring of 2013. This review will consider the effect on families of the introduction of independent taxation in 1990, and tax credits a decade later. It will include recommendations for making the tax system fairer and reducing the high effective marginal rates faced by many families.

11.

Recognition of the couple relationship in the UK tax system is our preferred response to anomalies in tax burdens and marginal rates compared with OECD benchmarks. The first step in this direction should be for the UK Government to act on its Coalition Agreement to recognise marriage in the tax system through the introduction of a transferable allowance. Given the time needed to implement this policy, it must be given effect in the resolutions following the 2013 Budget.

The Taxation of Families – International Comparisons 2011

chapter 1 Introduction 1.

This is our sixth annual international review of the taxation of families. Previous reviews included a detailed analysis of the UK position as well as international comparisons, but differences of scope and emphasis call for two separate reports. Consequently this report is limited to international comparisons. We intend to publish our detailed analysis of the taxation of UK families in the Spring of 2013.

This report compares the tax burdens of various household types in the UK with those of similar households in other developed countries in the calendar year 2011. We consider not only households with an ‘average wage’ but also those with incomes above and below this figure.

For the purposes of this report, ‘tax’ means personal income tax plus employee social security contributions (SSCs) minus cash benefits.1 The combined effect of these three elements determines how well off any particular family is. The term ‘tax rate’ or ‘tax burden’ is used when tax is expressed as a percentage of gross wage earnings. A negative percentage indicates that cash benefits exceed income tax and national insurance contributions. Where we consider the income tax element separately, we use the term ‘income tax’.

Structure of document 4.

The remainder of this report is structured as follows: •

Chapter 2 explains how families are taxed in the UK and in other OECD countries, highlighting the differences between individual and joint tax systems.

•

Chapter 3 uses OECD data for 2011 to compare UK tax burdens on different household types at various income points with those in other countries.

•

Chapter 4 uses OECD data for 2011 to compare marginal effective tax rates faced by UK households with those in other countries.

•

Chapter 5 presents our conclusions.

The Annex to this report is a comparison of income tax burdens faced by UK households with those in other countries. Information relating to individual OECD countries is provided in Appendices.

The review does not take account of VAT or any other indirect tax, housing benefit or any other income related benefits. 11

The Taxation of Families – International Comparisons 2011

Data sources

For international comparisons, we use statistics published by the OECD in Taxing Wages.2 These statistics take account of income taxes, social security contributions and cash benefits of eight different kinds of household in 33 of the 34 OECD member countries.3 Data for 2011 for Greece is not available. The 2011 edition of Taxing Wages shows estimates for 2011 and definitive results for 2010.4

The OECD average wage that we use for international comparisons takes account of the earnings of manual and non-manual workers including supervisory staff. The OECD estimate of the average wage in the UK in 2011 is £34,2865 (£658 per week). This compares with UK median weekly earnings for all employees of £501 (£26,123 per annum).6 We consider tax burdens near this lower earnings level by using an income point of 75% of the OECD average wage.

The OECD provides a link to unpublished data for individual countries, enabling us to look at tax burdens and marginal rates at additional income points. We use footnotes throughout the document to indicate where we have taken figures from Taxing Wages and where figures have been derived from linked individual country data (‘Statlink’ data).

To calculate the UK income tax burden excluding tax credits, required for the Annex, we use the Tax Benefit Model Tables (TBMT) for the year 2011-12 provided by the Department for Work and Pensions.

Taxing Wages 2010-2011, 2011 Edition, OECD Paris 2012

In 2011 there were 34 OECD member countries: Australia, Austria, Belgium, Canada, Chile, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, Switzerland, Turkey, United Kingdom, United States.

We use calendar years when referring to OECD figures and tax years when referring to UK figures.

Taxing Wages 2010-2011 Table 0.5

The ONS Annual Survey of Hours and Earnings (ASHE) is the most reliable source of information about wage levels in the UK. The 2011 survey shows median weekly earnings for all employees as £501 (£26,123 per annum).

The Taxation of Families – International Comparisons 2011

chapter 2 Tax Systems in OECD Countries This chapter explains how families are taxed both in the UK and in other OECD countries, highlighting the differences between individual and joint tax systems. •

Of the large OECD countries, only the UK and Mexico has a system of independent taxation with no recognition of spousal obligations and, in general, no transferable allowances.

•

Ten OECD countries including France, Germany and the United States have joint taxation of married couples.

•

Thirteen OECD countries including Italy and Japan have allowances for spouses or transferable allowances.

In the UK, total tax revenue as a proportion of Gross Domestic Product (GDP) is similar to that in most other OECD countries. In 2009, the latest year for which full information is available, the figure for the UK was 34.3%, close to the (unweighted) average for the OECD of 33.8%. In 15 of the 34 OECD countries the proportion was higher than in the UK.

10.

However, the UK is unlike most other OECD countries in having a system of independent individual income taxation with no recognition of spousal obligations or provision for transferring allowances. Most other countries take account of spousal obligations: some give married couples the option of being taxed jointly or as individuals, others have a system of transferable allowances.

11.

Tax systems can be divided into two main types: individual and joint. Under individual taxation, interdependence between family members is ignored. For tax purposes each family member is treated as a separate individual.

12.

Under joint taxation, the interdependence of family members is recognised and their tax bill adjusted to take account of family obligations. This may be done through special tax allowances, special tax bands, or through income splitting. Under income splitting, aggregate household income is divided into a number of slices, each of which is taxed as though it were that of a single person without dependants. Income splitting has the effect of reducing, often significantly, the tax paid by a family. 13

The Taxation of Families – International Comparisons 2011

13.

Within the OECD, the distinction between individual and joint taxation is not always easy to maintain. Under some ‘individual’ tax regimes, joint taxation is an option; under some ‘joint’ regimes, individual taxation is an option. Many individual tax systems exhibit joint elements such as tax reliefs and credits for spouses, or allowances that are transferable between spouses.7 Thirteen OECD countries with individual taxation, including Italy and Japan, have such reliefs or transferable allowances.

14.

Table 1 summarises taxation arrangements in OECD countries. More detailed information about the tax system in each of these countries is given in Appendix A.

Table 1 Tax treatment of married couples in OECD countries Individual taxation no recognition of spousal obligations Country

Population (m)

Individual taxation spousal allowances/credits or transferable allowances Country

Population (m)

Joint taxation of married couples Country

Chile Finland Greece Hungary Israel Mexico New Zealand Slovenia Sweden UK

17.1 5.4 11.3 10.0 7.6 112.3 4.4 2.0 9.4 61.3

Australia Austria Belgium Czech Republic Denmark Iceland Italy Japan Korea Netherlands Slovakia Spain Turkey

22.3 8.4 10.9 10.5 5.5 0.3 60.1 127.1 49.4 16.6 5.4 46.1 73.0

Estonia France Germany Luxembourg Ireland Norway Poland Portugal Switzerland USA

Total

240.8 20.1%

Total

435.6 36.4%

Total

Population (m) 1.3 63.0 81.7 0.5 4.5 4.9 38.2 10.6 7.8 309.3

521.8 43.5%

Source: OECD General population statistics, accessible at http://stats.oecd.org/Index.aspx

15.

The total population of the listed countries is 1.2 billion. Of these, 43.5% live in countries with income splitting or some similar system, and a further 36.4% in countries with spousal tax allowances/credits or transferable allowances. Only 20.1% live in countries with individual taxation without spousal allowances or credits. Most of these live in just two countries: the UK and Mexico. Among highly developed large economies, the UK is alone in operating a tax system that ignores spousal obligations.

OECD report PF1.4: Neutrality of tax/benefit systems updated 15 April 2011

The Taxation of Families â&#x20AC;&#x201C; International Comparisons 2011

Recent trends in statutory tax rates 16.

The most well-defined trend across OECD countries has been towards a reduction in top statutory personal income tax (PIT) rates, inclusive of surtaxes and sub-central income taxes. The OECD-wide average top PIT rate decreased significantly in each of the last three decades, from 87.5% in 1981 to 50.6% in 1990, 48.5% in 2000 and 41.7% in 2010. However, six countries increased their top rate in 2010, signalling a trend reversal.

17.

From 2000 to 2010 there has been a reduction in the income threshold at which the top statutory PIT rate applies, minimising the impact of cuts in the top PIT rate.

18.

The top PIT rate applies to only a small part of the population. The rate that applies at average gross earnings is far more important for most people. In the last decade, the statutory PIT rate levied on the average wage declined in 23 OECD countries. In 2010 the OECD-wide average PIT rate at average earnings was 27.4%.

19.

By contrast, there was no clear trend in the bottom statutory PIT rate from 2000 to 2010. While it decreased in many OECD countries, it increased in others. The magnitude of the changes varied significantly across countries.

20.

The average tax rate is normally lower than the statutory rate. All OECD countries exempt an initial portion of earnings from PIT through provisions such as basic personal tax allowances, basic personal tax credits or zero-rate tax brackets. However, in some countries, the exemption is limited to employment income and/ or to taxpayers with incomes below a certain threshold. The value of the basic exemption, expressed as a share of the average wage, increased noticeably in more than a third of OECD countries and decreased in only six countries over the last decade.

21.

The top all-in tax rate declined on average across OECD countries from 2000 to 2010, primarily as a result of lower top statutory PIT rates, and to a lesser extent due to changes in employee SSC schedules. However, the average gap between the top all-in rate and the top PIT rate widened, from 2.9 percentage points to 3.7 percentage points, reflecting the growth of employee SSCs as a share of total tax revenues in most countries.

The Taxation of Families – International Comparisons 2011

chapter 3 Comparison of Tax Burdens This chapter uses OECD data to compare the UK tax burden with that in other countries. We look at six different household types (four one-earner, two two-earner) at various income points. Then we compare the tax burden on families with the tax paid by single people. Finally we summarise our findings regarding the income tax component of the overall tax burden.

22.

•

For single taxpayers without children, the UK tax burden is close to the OECD average at all income points assessed. It is greater than the OECD average for one-earner married couples without children, except at the lowest income point.

•

The tax burden on low income households with children compares very favourably with that in other OECD countries.

•

But for one-earner families earning £25,715 (close to the median wage) in the UK, the tax burden is greater than the 2011 OECD average: 8% greater for a single parent family with two children, and 29% greater for a one-earner married couple with two children.

•

At the OECD average wage for the UK of £34,286, single parents with two children are paying 30% more than the 2011 OECD average, and one-earner two-child married couples, 42% more.

•

At the OECD average wage, one-earner married couples with two children in the UK pay 73% of a single person’s tax compared with the OECD average of 52%.

•

For one-earner families, the UK income tax burden is greater than the OECD average at all income points assessed.

We use new OECD data for 2011 (UK tax year 2011-12) to compare the UK tax burden with OECD and EU averages for four different one-earner household types: •

singles without children

The Taxation of Families – International Comparisons 2011

•

one-earner married couples without children

•

singles with children

•

one-earner married couples with children8

23.

Our six income points for each household type range from 36% to 150% of the OECD average wage. We have added the 36% income point to the five (50% to 150%) used in our last review to approximate the income level represented by the 2011 UK minimum wage (£237.73 per week,9 £12,396 per annum). The 75% income point is close to 2011 UK median gross weekly earnings of full-time employees (£501 per week, £26,124 per annum).

24.

In addition, we look at the tax burden on two-earner married couples at two income points (133% and 167% of the OECD average wage).

25.

The average wage is as defined by the OECD i.e. average gross earnings of both manual and non-manual workers including supervisory staff. The average wage in the UK in 2011 is stated by the OECD to be £34,286, compared with £34,297 in 2010.10

26.

References to the EU are to be understood as references to EU countries that are also OECD members. These EU countries are grouped in the EU(15) and the EU(21).11 EU(15) and EU(21) figures for 2011 exclude data for Greece, which is not available.

27.

Historical data for eight household types, comprising UK and average OECD and EU tax rates for the period 2000-2011, is to be found in Appendix B. Data for 2011 for individual countries for the same eight household types is to be found in Appendix C.

The OECD data available does not enable us to make equivalent international comparisons for cohabiting as opposed to married couples. It seems from the limited information provided by the OECD that the tax treatment of cohabiting couples is in many countries less generous than that of married couples. In the UK there is, in many countries, no difference for income tax purposes between married and cohabiting couples.

Assuming the ASHE average of 39.1 hours worked at the rate of £6.08 per hour

Since the average wage in the UK in 2011 is stated by the OECD to be £34,286, the six income points for the UK are as follows: 36% = £12,343 50% = £17,143 75% = £25,715 100% = £34,286 125% = £42,858 150% = £51,429

In 2011 these EU countries were OECD members: Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Luxembourg, Netherlands, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, United Kingdom. They constitute the EU(21). The EU(15) excludes Czech Republic, Estonia, Hungary, Poland, Slovenia and Slovakia. 17

The Taxation of Families – International Comparisons 2011

Tax burden on one-earner households Single person without children 28.

Table 2 and Chart 1 show the tax burden on a single person without children at six income points. We compare the UK with all OECD countries together and with the EU(15) and EU(21) countries.

Table 2 Tax as percentage of gross wages 2011 – single person without children percentage of OECD average wage 36%

50%

75%

100%

125%

150%

10.5%

18.2%

22.8%

25.1%

26.6%

29.1%

OECD

13.3%

17.0%

22.1%

24.9%

27.5%

29.4%

EU(15)

15.1%

20.0%

26.5%

29.8%

33.0%

35.6%

EU(21)

15.6%

19.9%

25.8%

28.8%

31.5%

33.5%

Source: OECD ‘Statlink’ tables pp. 107-139

Chart 1 Tax as percentage of gross wages 2011 Single person without children 40% 30% UK 20%

OECD EU(15)

10%

EU(21) 0% 36%

50%

75%

100%

125%

150%

percentage of OECD average wage

29.

In general, the tax burden on single people without children in the UK is similar to that in other countries. At 36% of average wage, the tax burden in the UK is less than the OECD average and the EU averages. At all other income points, it is close to the OECD average and slightly less than the EU averages.

30.

The tax burden on a single person without children at average wage has risen from 24.3% in 2010 to 24.9% in 2011 in the OECD, but has fallen from 25.5% to 25.1% in the UK.

The Taxation of Families – International Comparisons 2011

One-earner married couple without children 31.

Table 3 and Chart 2 compare the tax paid by a one-earner married couple without children as a percentage of income in the UK with the tax burden in OECD and EU countries.

Table 3 Tax as percentage of gross wages 2011 – one-earner married couple without children percentage of OECD average wage UK

36%

50%

75%

100%

125%

150%

-5.3%

16.6%

22.8%

25.1%

26.6%

29.1%

OECD

7.7%

12.9%

18.2%

21.6%

24.4%

26.4%

EU(15)

10.6%

16.8%

22.2%

25.9%

28.8%

29.1%

EU(21)

10.5%

16.2%

20.6%

24.8%

27.6%

29.9%

Source: OECD ‘Statlink’ tables pp. 107-139

Chart 2 Tax as percentage of gross wages 2011 One-earner married couple without children 40% 30% 20%

UK OECD

10%

EU(15) 0%

EU(21)

-10% 36%

50%

75%

100%

125%

150%

percentage of OECD average wage 32.

At all income levels except the 36% income point, UK one-earner married couples without children carry a greater tax burden than the OECD average. At 50% of average wage, UK couples have a tax burden that is 29% greater than the OECD average, but the disparity is less at higher income points. The UK tax burden at all income levels is similar to the EU averages.

The Taxation of Families – International Comparisons 2011

Single person with two children 33.

Table 4 and Chart 3 compare the tax paid by a single person with two children as a percentage of income in the UK with the tax burden in OECD and EU countries.

Table 4 Tax as percentage of gross wages 2011 – single person with two children percentage of OECD average wage UK

36%

50%

75%

100%

125%

150%

-65.4%

-26.6%

6.6%

18.4%

22.5%

25.7%

OECD

-23.4%

-8.5%

6.1%

14.2%

18.7%

22.2%

EU(15)

-23.5%

-8.0%

8.9%

18.1%

23.7%

27.7%

EU(21)

-8.0%

7.4%

16.3%

21.6%

25.3%

Source: OECD ‘Statlink’ tables pp. 107-139

Chart 3 Tax as percentage of gross wages 2011 Single person with two children 40% 30% 20% 10% 0% -10% -20% -30% -40% -50% -60% -70%

UK OECD EU(15) EU(21) 36%

50%

75%

100%

125%

150%

percentage of OECD average wage

34.

At 36% and 50% of average wage, a single parent with two children has a negative tax liability i.e. cash transfers exceed income tax and SSCs. The OECD and EU averages are also negative, but much smaller. However, as incomes rise, the UK burden rises rapidly, whereas the OECD and EU averages do not. For a single person with two children on 75% of average wage, the UK tax burden is 8% greater than the OECD average; at average wage it is 30% greater. At and above average wage the UK rate is similar to the EU averages.

The Taxation of Families – International Comparisons 2011

One-earner married couple with two children 35.

Table 5 and Chart 4 compare the tax paid by a one-earner married couple as a percentage of income in the UK with the tax burden in OECD and EU countries.

Table 5 Tax as percentage of gross wages 2011 – one-earner married couple with two children percentage of OECD average wage 36%

50%

-65.4%

-26.6%

OECD

-23.5%

-9.3%

EU(15)

-21.9%

-7.6%

EU(21)

-23.2%

-8.9%

75%

100%

125%

150%

6.6%

18.4%

22.5%

25.7%

5.1%

13.0%

17.9%

21.3%

8.6%

16.9%

22.2%

26.0%

6.4%

14.3%

19.7%

23.4%

Source: OECD ‘Statlink’ tables pp. 107-139

Chart 4 Tax as percentage of gross wages 2011 One-earner married couple with two children 40% 30% 20% 10% 0% -10% -20% -30% -40% -50% -60% -70%

UK OECD EU(15) EU(21) 36%

50%

75%

100%

125%

150%

percentage of OECD average wage 36.

At low income levels one-earner married couples with two children fare relatively well in the UK. However, the picture changes significantly as income rises. At 75% of average wage, UK one-earner married couples with two children pay 29% more tax than the OECD average, and at 100% of average wage 42% more. At 150% of average wage, the UK tax burden is still some 21% greater than the OECD average. These UK families pay slightly more than the EU averages at and above average wage, with the exception of EU(15) average at the 150% income point. 21

The Taxation of Families â&#x20AC;&#x201C; International Comparisons 2011

37.

The tax burden on a one-earner married couple with two children at average wage has risen from 12.5% in 2009 to 13.0% in 2010 in the OECD, but has fallen from 19.0% to 18.4% in the UK.

Tax burden on two-earner households Two-earner married couple without children 38.

For two-earner married couples without children, comparative data is only available where the main earner is on average wage and the second earner earns one third of average wage. The OECD data shows that in 2011 the UK tax burden was 21.7% (having been 22.8% in 2010). This is higher than the OECD average of 21.6% (21.0% in 2010), but lower than the EU averages, which were 25.2% (24.5%) for the EU(15) and 24.7% (23.9%) for the EU(21).

Two-earner married couple with two children 39.

Comparative data is available for two-earner married couples with two children on 100% and 33% of average wage and 100% and 67% of average wage. At 133% of average wage, the UK tax rate was 17.8% (having been 17.9% in 2010), higher than the OECD average of 15.6% (15.1% in 2011), but similar to the EU averages. When the combined income is 167% of average wage, UK tax was 20.7% (21.5% in 2010), higher than the OECD average of 19.0% (18.3%), but lower than the EU(15) average of 21.3% (22.0%) and the EU(21) average of 22.8% (20.7%).

Tax on families as percentage of single personâ&#x20AC;&#x2122;s tax

40.

Comparing tax rates for any particular household type can be misleading. A higher rate in any given country may be simply a reflection of higher tax rates generally. For example, the 2011 OECD figures show that a one-earner married couple with two children on average wage has a tax rate of 21.0% in Germany compared with 18.4% in the UK. However, Germany has a much more family orientated tax system than the UK, and married coupleâ&#x20AC;&#x2122;s tax that is only 53% of that of a single person without dependants, compared with 73% in the UK.

41.

Table 6 shows the UK tax burden on two family types (single person with two children and one-earner married couple with two children) as a percentage of that on a single person without children at five income points, with averages for the OECD, EU(15) and EU(21). Appendix D shows percentages for all OECD countries at single income points for these two family types, and also for a twoearner married couple with two children.

The Taxation of Families â&#x20AC;&#x201C; International Comparisons 2011

Table 6 Tax as percentage of tax on single person without children 2011 percentage of OECD average wage 36%

50%

75%

100%

125%

150%

(a) single person, two children UK

-620%

-146%

29%

73%

85%

88%

OECD

-176%

-50%

28%

57%

68%

76%

EU(15)

-156%

-40%

34%

61%

72%

78%

EU(21)

-51%

-40%

29%

56%

69%

75%

(b) one-earner married couple, two children UK

-620%

-146%

29%

73%

85%

88%

OECD

-177%

-55%

23%

52%

65%

73%

EU(15)

-145%

-38%

32%

57%

67%

73%

EU(21)

-149%

-44%

25%

50%

63%

70%

Note: A negative figure means that the tax liability of the (a)/(b) household is negative, i.e. there is a net benefit. The negative percentage amount denotes the size of the net benefit (as a proportion of income) compared with the size of the liability of a single person without children. Source: derived from Tables 2, 4 and 5

Single person with two children 42.

As already noted, UK tax credits are relatively generous, with the result that at low incomes the tax burden is negative to a greater extent than in other countries. The gap between the tax burden on a lone parent with two children on 50% of average wage and that of a single person without children on the same income is much wider in the UK than in most other countries. In 2011 it was -146%, compared with an OECD average of -50%, an EU(15) average of -40% and a EU(21) average of -40%. However, the picture changes rapidly as income rises, such that the gap becomes narrower in the UK than in most other countries. At average wage, the 2011 UK tax burden on a lone parent with two children was 73% of that of a single person without children, whereas the OECD average was 57%, the EU(15) average 61% and the EU(21) average 56%.

One-earner married couple with two children 43.

As in the case of a lone parent, the difference in 2011 between the tax burden on a one-earner married couple with two children on 50% of average wage and that of a single person without children on the same income is much wider in the UK than in most other countries. The 2011 UK tax burden on a one-earner married couple with two children and an average wage was 73% of that paid by a single person without children, whereas the OECD average was 52%, the EU(15) average 57% and the EU(21) average 50%. In 2011, the US tax burden on a 23

The Taxation of Families â&#x20AC;&#x201C; International Comparisons 2011

one-earner married couple with two children on average wage ($46,800) was only 10.4%, i.e. only 36% of a single personâ&#x20AC;&#x2122;s tax rate of 28.6%. 44.

At 150% of average wage, the UK tax burden on a two-earner married couple with two children was 88% of that on a single person without children, compared with the OECD average of 73%, the EU(15) average of 73% and the EU(21) average of 70%. Other countries withdraw support for families as income rises, but it remains substantial even at 150% of average wage.

Two-earner married couple with two children 45.

The gap between the tax burden on a two-earner married couple with two children on 167% of average wage and that on a single person without dependants on the same income is narrower in the UK than in most other countries, but not greatly so. In 2011 the average OECD burden on a two-earner married couple with two children on 167% of average wage was 63% of that on a single person without children (19.0% compared with 30.4%). In the UK it was 68% (20.7% compared with 30.4%).

Historical perspective 46.

Table 7 and Chart 5 show the UK tax burden on a one-earner married couple with two children on average wage as a percentage of that on a single person without children on the same income for the period 2000-2011, with averages for the OECD, EU(15) and EU(21). Although the UK figure has fallen from 80% in 2000, it remains much higher than OECD and EU averages.

Table 7 Tax burden on one-earner married couple with two children as percentage of tax paid by single person without children 2000-2011 At 100% average OECD wage Year

OECD

EU(15)

EU(21)

2000

80%

58%

59%

54%

2003

74%

58%

53%

2004

75%

57%

53%

2005

75%

57%

53%

2006

76%

55%

57%

52%

2007

76%

54%

57%

52%

2008

74%

53%

57%

51%

2009

73%

51%

56%

50%

2010

74%

52%

57%

51%

2011

73%

52%

57%

50%

Note: data for 2001 and 2002 not provided in Taxing Wages 2010-2011 Source: derived from columns 2 and 5 of Appendix B

The Taxation of Families – International Comparisons 2011

Chart 5 Tax on one-earner two-child married couple as percentage of tax on single person without children at OECD average wage 2000-2011

80% 70% 60% 50%

40%

OECD

30%

EU(15)

20%

EU(21)

10% 0% 2000 2003 2004 2005 2006 2007 2008 2009 2010

2011

Income tax burden on one-earner households 47.

The relatively high tax burden on UK one-earner families with an income of at least 75% of the OECD average wage (i.e. those with at least a median income) results from the fact that the UK income tax system, unlike that in most other OECD countries, takes no account of marriage or family responsibilities. Now that these allowances have gone, families that do not receive tax credits bear a much heavier tax burden than comparable families in other OECD countries.

48.

In the Annex to this report, we make international comparisons of the income tax component of the overall tax burden, using OECD data for 2011 for four different one-earner household at six income points. For countries other than the UK, we follow OECD practice in treating tax credits as income tax offsets, even where a portion is payable in cash, because the tax liability is insufficient to absorb the credit (‘non wastable’ credits). We depart from OECD practice in excluding tax credits when calculating the income tax burden for the UK. We do so because UK tax credits do not reduce tax liabilities, but are paid direct to the claimant.

49.

Our main findings with regard to the income tax burden are these:

50.

•

For single people without children, the UK income tax burden is somewhat greater than the OECD average at low income points, but very similar to it at and above the OECD average wage.

•

For one-earner families, the UK income tax burden is greater than the OECD average at all income points. The disparity is greatest for low income families. For one-earner married couples with two children, the UK income tax burden is also greater than the EU(15) and EU(21) averages at all income points.

Table 8 and Chart 6 show the income tax burden for a one-earner married couple with two children at six income points. At 75% of the OECD average 25

The Taxation of Families – International Comparisons 2011

wage (£25,715, close to the UK median wage), the UK income tax burden on a one-earner married couple with two children is 178% greater than the OECD average (14.2% compared with 5.1%).

Table 8 Income tax as percentage of gross wages 2011 – one-earner married couple with two children percentage of OECD average wage 36%

50%

75%

100%

125%

150%

7.9%

11.3%

14.2%

15.7%

16.7%

20.6%

OECD

-4.9%

-0.9%

5.1%

9.4%

13.0%

15.6%

EU(15)

-4.8%

0.4%

7.5%

12.4%

16.3%

19.7%

EU(21)

-5.3%

-1.1%

4.7%

9.3%

13.0%

16.0%

Source: OECD ‘Statlink’ tables pp. 107-139

Chart 6 51.

UK tax credits compensate low income families for the heavy income tax burden, such that their overall tax burden is low by international standards. But for many

Income tax as percentage of gross wages 2011 One-earner married couple with two children 30% 20% UK 10%

OECD EU(15)

EU(21)

-10% 36%

50%

75%

100%

125%

150%

percentage of OECD average wage families with modest incomes, the overall tax burden remains higher than the OECD and EU averages. The tapered withdrawal of UK tax credits is largely responsible for high effective marginal tax rates across a wide income range. We consider these rates in the next chapter.

The Taxation of Families – International Comparisons 2011

chapter 4 Comparison of Marginal Effective Tax Rates This chapter uses OECD data to compare UK marginal effective tax rates with those in other countries. We look at four different one-earner households at various income points. •

The Marginal Effective Tax Rate (METR), which shows how much of an extra unit of income is retained, is an important influence on what work people take.

•

For a one-earner family with two children, the UK METR is 73% across a wide income range (from 22% to 88% of the OECD average wage). This METR is nearly twice as high as the OECD and EU averages at the 36%, 50% and 75% income points.

•

The withdrawal of tax credits accounts for a large part of the high UK METR.

52.

It is not only the average tax rate that matters. The marginal tax rate, which shows how much of an extra unit of income is retained, is an important influence on whether people work, whether they increase working hours, and whether they look for a better-paid job. METR takes account of income tax and employee SSCs payable, and cash benefits foregone.

53.

We use OECD data for 2011 (UK tax year 2011-12) to compare the UK with all OECD countries together and with the EU(15) and EU(21) countries for four different one-earner household types: •

singles without children

•

one-earner married couples without children

•

singles with children

•

one-earner married couples with children.

Our six income points for each household type range from 36% to 150% of the OECD average wage.

The Taxation of Families – International Comparisons 2011

Marginal effective tax rates Single person without children 54.

Table 9 and Chart 7 show the METR for a single person without children at six income points. At the 36% income point the UK METR far exceeds the OECD and EU averages, but at all other income points the UK rate is similar to the averages.

Table 9 Marginal effective tax rate 2011 – single person without children percentage of OECD average wage 36%

50%

75%

100%

125%

150%

73.0%

32.0%

42.0%

OECD

22.8%

30.7%

31.9%

44.6%

38.0%

39.2%

EU(15)

26.4%

38.5%

38.8%

42.8%

47.7%

47.9%

EU(21)

25.2%

36.1%

36.3%

40.3%

43.0%

43.6%

Source: OECD ‘Statlink’ tables pp. 107-139

Chart 7 Marginal effective tax rate 2011 Single person without children 80% 70% 60% 50% 40% 30% 20% 10% 0%

UK OECD EU(15) EU(21) 36%

50%

75%

100%

125%

150%

percentage of OECD average wage

One-earner married couple without children 55.

Table 10 and Chart 8 show the METR for a one-earner married couple without children at six income points. At the 36% and 50% income points the UK METR far exceeds the OECD and EU averages, but at all other income points the UK rate is similar to the averages.

The Taxation of Families – International Comparisons 2011

Table 10 Marginal effective tax rate 2011 – one-earner married couple without children percentage of OECD average wage 36%

50%

75%

100%

125%

150%

73.0%

32.0%

42.0%

OECD

21.2%

27.5%

29.1%

42.1%

35.7%

37.2%

EU(15)

19.3%

34.2%

35.7%

38.0%

43.3%

44.9%

EU(21)

23.1%

30.7%

32.4%

37.0%

39.9%

41.0%

Source: OECD ‘Statlink’ tables pp. 107-139

Chart 8 Marginal effective tax rate 2011 One-earner married couple without children 80% 70% 60% 50% 40% 30% 20% 10% 0%

UK OECD EU(15) EU(21) 36%

50%

75%

100%

125%

150%

percentage of OECD average wage

Single person with two children 56.

Table 11 and Chart 9 show the METR for a single person with two children at six income points. At income points below 100%, the UK METR far exceeds the OECD and EU averages, but at all other income points the UK rate is similar to the OECD average.

The Taxation of Families – International Comparisons 2011

Table 11 Marginal effective tax rate 2011 – single person with two children percentage of OECD average wage 36%

50%

75%

100%

125%

150%

73.0%

32.0%

42.0%

OECD

27.2%

36.9%

36.8%

48.3%

38.2%

53.2%

EU(15)

26.0%

45.8%

45.1%

48.1%

46.4%

77.9%

EU(21)

26.7%

41.8%

40.8%

43.6%

42.6%

64.0%

Source: OECD ‘Statlink’ tables pp. 107-139

Chart 9 Marginal effective tax rate 2011 Single person with two children 80% 70% 60% 50% 40% 30% 20% 10% 0%

UK OECD EU(15) EU(21) 36%

50%

75%

100%

125%

150%

percentage of OECD average wage

One-earner married couple with two children 57.

Table 12 and Chart 10 show the METR for a one-earner married couple with two children at six income points. At income points below 100%, the UK METR far exceeds the OECD and EU averages, but at all other income points the UK rate is similar to the OECD average.

Table 12 Marginal effective tax rate 2011 – one-earner married couple with two children percentage of OECD average wage 36%

50%

75%

100%

125%

150%

73.0%

32.0%

42.0%

OECD

23.2%

32.1%

34.1%

36.4%

50.1%

EU(15)

23.4%

41.4%

42.1%

41.1%

43.2%

70.9%

EU(21)

23.9%

36.4%

35.8%

38.6%

39.8%

59.6%

Source: OECD ‘Statlink’ tables pp. 107-139

The Taxation of Families – International Comparisons 2011

Chart 10 Marginal effective tax rate 2011 One-earner married couple with two children 80% 70% 60% 50% 40% 30% 20% 10% 0%

UK OECD EU(15) EU(21) 36%

50%

75%

100%

125%

150%

percentage of OECD average wage 58.

Chart 11 shows METRs in OECD countries at 75% of average wage for a oneearner married couple with two children. The UK METR is the highest of all OECD countries, and almost twice as high as the OECD and EU averages.

59.

The METRs faced by one-earner families in individual OECD countries at four income points (36%, 50%, 75% and 100% of OECD average wage) are set out in Appendix E.

Impact of UK tax credits 60.

The UK METR for a one-earner married couple with two children remains at 73% across a wide income range, including the 36%, 50% and 75% income points.12 Single parents with two children in the UK face the same high rates. For both family types, the UK METR falls to 43.7% at 88% of the OECD average wage, and to 32% at 89%.

61.

The withdrawal of tax credits accounts for much of the high UK METR. Both Working Tax Credit and Child Tax Credit are income related. They are tapered jointly, with Working Tax Credit being withdrawn first. The 73% METR faced by one-earner families comprises income tax payable 20%, SSCs payable 12%, tax credits withdrawn 41%.

METRs take no account of ‘passported benefits’, which are linked to entitlement to other benefits. In the UK one of the most important of these in the UK is free school meals, the loss of which is a significant disincentive to obtain a job which gives an entitlement to Working Tax Credit. 31

The Taxation of Families â&#x20AC;&#x201C; International Comparisons 2011

Chart 11 Marginal effective tax rate at 75% of average wage One-earner married couple with two children United Kingdom Ireland Canada Australia Italy Netherlands United States Belgium Iceland Austria Finland EU(15) average Germany Denmark Spain Hungary New Zealand Norway EU(21) average OECD average Turkey Sweden Portugal Israel Luxembourg Estonia Japan Slovenia France Poland Switzerland Slovak Republic Mexico Czech Republic Korea Chile 0%

10%

20%

30%

40%

50%

60%

70%

80%

The Taxation of Families – International Comparisons 2011

chapter 5 Conclusions 62.

International comparisons for 2011, the latest year for which there is OECD data, reveal that the tax burdens of many one-earner UK households compare favourably with the international averages: •

The tax burden of single people without family responsibilities is lower than the averages for the EU(15) and EU(21), and in line with the average for all OECD countries.

•

At low incomes (36% and 50% of the OECD average wage), families appear to do better, often significantly so, than their counterparts in other countries.

63.

64.

UK one-earner married couples without children carry a greater tax burden than their OECD, EU(15) and EU(21) counterparts at all income points except 36% of the OECD average wage.

65.

The UK households that compare most unfavourably with their equivalents in other countries are one-earner families with children on middle incomes. At the OECD average wage for the UK of £34,286, the tax burden on single parents with two children is 30% greater than the 2011 OECD average, and the burden on one-earner two-child married couples 42% greater. The tax burden on these family types is also higher than the 2011 OECD average at 75% of the OECD average wage (£25,715, close to the UK median wage). For a single parent family with two children, it is 8% greater, and for a one-earner married couple with two children 29% greater.

66.

For single parents with two children on an OECD average wage, the tax burden compared with that of singles without children is 28% greater than the OECD average (73% compared with 57%). For one-earner married couples with two children at the same income point, the figure is 40% (73% compared with the OECD average of 52%).

67.

There has been a slight improvement since 2010 in the UK tax burden at the OECD average wage, both in absolute terms and compared with the average tax burden in OECD countries at this income point. The tax burden on a one-earner married couple with two children at average wage has fallen from 19.0% to 18.4% in the UK, but risen from 12.5% in 2010 to 13.0% in 2011 in the OECD.

68.

The UK income tax burden on one-earner families is higher than the 2011 OECD average, markedly so at income points below the OECD average wage. At 75% 33

The Taxation of Families â&#x20AC;&#x201C; International Comparisons 2011

of the OECD average wage, the UK income tax burden on a single parent family with two children is 95% greater than the OECD average (14.2% compared with 7.3%), and on a one-earner married couple with two children 178% greater (14.2% compared with 5.1%).

69.

UK tax credits compensate low-income families for the heavy income tax burden, such that their overall tax burden is low by international standards. But for many families with modest incomes, the overall tax burden remains higher than the OECD and EU averages. The tapered withdrawal of UK tax credits is largely responsible for high effective marginal tax rates across a wide income range. The 73% METR on one-earner families with children at the 36%, 50% and 75% income points is a phenomenon without parallel in the OECD.

70.

The challenges and policy implications arising from these conclusions will be considered in our detailed analysis of the taxation of UK families, to be published in the early spring of 2013. This review will consider the effect on families of the introduction of independent taxation in 1990 and introduction of tax credits a decade later. It will include recommendations for making the tax system fairer and reducing the high marginal rates faced by many families.

71.

The Taxation of Families – International Comparisons 2011

Annex Comparison of Income Tax Burdens This annex uses OECD data to compare the UK income tax burden with that in other countries. We look at four different one-earner households at various income points.

•

When calculating the UK income tax burden, tax credits are not treated as tax offsets because they do not exempt an initial slice of income from taxation and are paid direct to the claimant.

•

For single people without children, the UK income tax burden is somewhat greater than the OECD average at low income points, but very similar to it at and above the OECD average wage.

•

We use OECD data for 2011 (UK tax year 2011-12) to compare UK income tax burdens with OECD and EU averages for four different one-earner household types: •

singles without children

•

one-earner married couples without children

•

singles with children

•

one-earner married couples with children.

Our six income points for each household type range from 36% to 150% of the OECD average wage. 2.

The average income tax rate is normally lower than the statutory rate because an initial level of income is exempted from tax. This can be achieved with a zero rate bracket, which applies a zero tax rate to a portion of taxable income below the tax bracket threshold; a basic personal allowance, which removes a portion of gross income from the tax base by reducing taxable income; or a basic personal tax credit, which offsets a tax liability at the last stage of a tax computation.

We calculate the income tax burden as (tax paid / gross wage earnings) * 100, where tax paid = (tax liability - tax offsets) and includes state and local taxes as well as central government income tax finally paid.

We exclude tax credits when calculating the income tax burden for UK households. We do so because UK tax credits do not reduce tax liabilities, but are paid direct to the claimant. This is a departure from OECD practice, although 35

The Taxation of Families – International Comparisons 2011

we note that the OECD treats all but one of New Zealand’s tax credits, which resemble the UK’s, as cash benefits rather than tax offsets.13 For other countries, we follow OECD practice in treating tax credits as tax offsets, to be included when calculating the income tax burden. Their purpose is to exempt an initial tranche of income, as a personal allowance does.

Income tax burden Single person without children 5.

Table A1 and Chart A1 show the income tax burden for a single person without children at six income points. We compare the UK with all OECD countries together and with the EU(15) and EU(21) countries. The UK income tax burden is somewhat greater than the OECD average at low income points, but very similar to it at and above the OECD average wage. The UK income tax burden is less than the EU averages at and above the OECD average wage.

Table A1 Income tax as percentage of gross wages 2011 – single person without children percentage of OECD average wage 36%

50%

75%

100%

125%

150%

7.9%

11.3%

14.2%

15.7%

16.7%

20.6%

OECD

4.3%

7.6%

12.1%

15.1%

17.8%

20.0%

EU(15)

5.0%

9.3%

14.7%

18.4%

21.9%

25.0%

EU(21)

4.4%

8.2%

13.3%

16.5%

19.5%

21.9%

Source: OECD ‘Statlink’ tables pp. 107-139 and (for UK) TBMT for 2011-12

Chart A1 Income tax as percentage of gross wages 2011 Single person without children 30% 25% 20%

15%

OECD 10%

EU(15)

EU(21)

36%

50% 75% 100% 125% percentage of OECD average wage

150%

Taxing Wages 2010-2011 Part III Country Details for New Zealand.

The Taxation of Families – International Comparisons 2011

One-earner married couple without children 6.

Table A2 and Chart A2 show the income tax burden for a one-earner married couple without children at six income points. The UK income tax burden is greater than the OECD average at all income points, most noticeably at 36% and 50% of the OECD average wage. The UK income tax burden is much greater than EU averages at low income points, but similar to them at and above the OECD average wage.

Table A2 Income tax as percentage of gross wages 2011 – one-earner married couple without children percentage of OECD average wage 36%

50%

75%

100%

125%

150%

7.9%

11.3%

14.2%

15.7%

16.7%

20.6%

OECD

0.9%

4.0%

8.5%

11.8%

14.7%

17.0%

EU(15)

1.2%

5.5%

10.7%

14.6%

18.0%

21.2%

EU(21)

1.0%

4.7%

9.1%

12.7%

15.8%

18.3%

Source: OECD ‘Statlink’ tables pp. 107-139 and (for UK) TBMT for 2011-12

Chart A2 Income tax as percentage of gross wages 2011 Married couple without children 25% 20% 15%

UK OECD

10%

EU(15)

EU(21)

36%

50%

75%

100%

125%

150%

percentage of OECD average wage

The Taxation of Families – International Comparisons 2011

Single person with two children 7.

Table A3 and Chart A3 show the income tax burden for a single person with two children at six income points. The UK income tax burden is greater than the OECD average at all income points. The disparity is greatest for low income families. The UK income tax burden is much greater than EU averages at low income points, but similar to them at and above the OECD average wage.

Table A3 Income tax as percentage of gross wages 2011 – single person with two children percentage of OECD average wage UK

36%

50%

75%

100%

125%

150%

7.9%

11.3%

14.2%

15.7%

16.7%

20.6%

OECD

-4.1%

1.3%

7.3%

11.4%

14.6%

17.1%

EU(15)

-3.2%

2.5%

9.7%

14.9%

18.9%

22.2%

EU(21)

-4.1%

1.0%

7.4%

12.2%

15.7%

18.6%

Source: OECD ‘Statlink’ tables pp.107-139 and (for UK) TBMT for 2011-12

Chart A3 Income tax as percentage of gross wages 2011 Single person with two children 30% 20%

10%

OECD EU(15)

EU(21) -10%

36%

50%

75%

100%

125%

percentage of OECD average wage

150%

The Taxation of Families – International Comparisons 2011

One-earner married couple with two children 8.

Table A4 and Chart A4 show the income tax burden for a one-earner married couple with two children at six income points. The UK income tax burden is greater than the OECD average and the EU(15) and EU(21) averages at all income points. The disparity is greatest for low income families.

Table A4 Income tax as percentage of gross wages 2011 – one-earner married couple with two children percentage of OECD average wage 36%

50%

75%

100%

125%

150%

7.9%

11.3%

14.2%

15.7%

16.7%

20.6%

OECD

-4.9%

-0.9%

5.1%

9.4%

13.0%

15.6%

EU(15)

-4.8%

0.4%

7.5%

12.4%

16.3%

19.7%

EU(21)

-5.3%

-1.1%

4.7%

9.3%

13.0%

16.0%

Source: OECD ‘Statlink’ tables pp. 107-139 and (for UK) TBMT for 2011-12

Chart A4 Income tax as percentage of gross wages 2011 One-earner married couple with two children 30% 20%

10%

OECD EU(15)

EU(21) -10%

36%

50%

75%

100%

125%

150%

percentage of OECD average wage

Joint

Individual

Family quotient system

Joint but separate assessment option

ESTONIA

FINLAND

FRANCE

GERMANY

Individual

CHILE

Individual

CANADA

Individual

Individual but joint return

BELGIUM

DENMARK

Individual

AUSTRIA

CZECH REPUBLIC

Individual

AUSTRALIA

Tax System

Allowances doubled if joint

N/A

Yes

N/A

Sole earner credit

Transferable Allowance?

Yes

N/A

Yes

Relief for Spouses?

As married if PACS (pacte civil de solidarité)

N/A

Yes if dependent

Yes

Additional allowance

N/A

Sole parent credit

Yes

Relief for Relief for Cohabitees? Lone Parents?

Appendix A – Tax Systems in OECD Countries 2011

Yes

N/A

Yes

Family tax benefit

Relief for Children?

Jointly assessed couples get double allowances including child tax credits.

Tax unit is aggregate family income. Quotient system applies to married couples and to civil union partners. Refundable tax credit for low income earners - partly being replaced by new cash benefit.

Child benefits - higher for single parents.

Tax unit is the individual. Child allowance for second and subsequent children.

Married person can transfer unutilised personal allowance to spouse.

Tax unit the individual. Credit for spouse.

Separate taxation. Family allowances.

Tax is levied separately. Credits given for spouse and eligible dependent (subject to spouse’s income) and children. Ceiling for spouse tax credit.

Married couples file joint returns. Spouses taxed separately but nonearning spouse taxed on a notional share (30%) of earning spouse’s income. Exemptions for children. Family allowances. Refundable tax credit (employment bonus) set against social security contributions.

Each person taxed separately. Tax credit for sole earner and sole parents. Parent’s credit increases if there are children. Child tax allowance, and a children’s tax credit paid together with children allowances - treated by OECD as a benefit.

Members of family taxed separately. Taxpayer can claim tax credit if contributing to dependent spouse. Not available where primary earner’s income exceeds A$159,000. Means tested payments for dependent children. Means tested benefit for single income couple and lone parent families. Taxable parenting payment to partnered and sole parents of low income families.

Notes

The Taxation of Families – International Comparisons 2011

Individual

ISRAEL

ITALY

JAPAN

KOREA

Individual

MEXICO

NETHERLANDS

Joint

IRELAND

LUXEMBOURG

Individual

HUNGARY

ICELAND

Individual

GREECE

Tax System

Yes

N/A

Yes

N/A

Yes

Transferable Allowance?

Tax credit

Yes

Relief for Spouses?

Tax credit

Yes

Tax credit

Yes

Relief for Relief for Cohabitees? Lone Parents?

Yes

Relief for Children?

General tax credit can be transferred to spouse but is being progressively phased out between 2009 and 2024. Taxpayer with partner receives child credit subject to joint income limit. Tax credits given for single person with children and taxpayer with fiscal partner. Single parents also receive this credit but income limit is lower than that for couples. Surplus credits can be transferred to a partner. Income from savings and investments can be freely split between husband and wife. Single parent credit available. Credits can be set off against both income tax and social security contributions.

Non-wastable employment subsidy credit.

Married couples taxed on joint income. Tax paid on 2 times half their income. Income from minor children included. Family allowance.

Spouse allowance subject to spouse income limit. Allowance for dependent children - allowance also given for other family dependents. Allowance for female lone parents.

Spouse allowance subject to spouse income limit. Also allowance for dependent children - same value as spouse allowance.

Tax credit system has replaced system of personal allowances. Includes credits for a spouse, children and other dependent relatives. A single parent can get tax credits for first child equal to spouse tax credit and child tax credit. Tax credits for children have to be shared equally between parents. If second earner cannot use 50% of credit, whole credit goes to main earner.

In general spouses taxed separately - business income is exception. Additional credit for women. Child credit for working mothers and fathers in one parent families. Additional single parent credit. Child allowance for parents of unmarried children.

Tax on combined income - can opt out, but tax payable by both spouses must be same as payable under joint taxation. Alternatively spouse can opt to be taxed as single. Married person’s credit is double basic credit. Single parent also gets a double basic credit. Home carers allowance where one spouse works at home to care for children, the aged or incapacitated persons.

Married couples may utilise each other’s basic tax credit.

Family tax allowance for families with children - can be split between spouses.

Joint return but each spouse liable for own tax. Married employees working in private sector paid 10% extra under Collective Labour Agreement. Public sector employees get fixed amount of €35 per month.

Notes

The Taxation of Families – International Comparisons 2011

Family

Individual

PORTUGAL

SLOVAKIA

SLOVENIA

Joint with separate option

N/A

Individual

USA

Joint

Individual

N/A

Transferable Allowance?

Individual

TURKEY

SWITZERLAND

SWEDEN

Individual but joint optional

POLAND

SPAIN

Individual but joint optional

Individual

NORWAY

NEW ZEALAND

Tax System

Yes

Relief for Spouses?

Yes

As lone parent

Yes

Joint rate schedule

Relief for Relief for Cohabitees? Lone Parents?

Yes

Tax credits

Yes

Nonwastable tax credit

Yes

Tax credits

Relief for Children?

Families taxed in one of three ways: jointly if married, separately, or (if unmarried),as heads of household. Married couple taxed jointly get $11,600 deduction, heads of household $8500, singles $5800. Refundable (non-wastable) earned income credit for low income families. No general cash transfers.

Married couples pay same tax and get same tax credits as single parents.

Minimum living relief based on minimum wage. 10% addition for a spouse who neither works nor has an income.

Tax deductions for married couples and children. Also a small tax credit. Special rate schedule for married couples, widowed, separated, divorced and unmarried with children.

Tax credits for social security contributions.

Basic allowance for married couples filing jointly. Smaller allowance for heads of household (unmarried or separated individuals with dependents). Family allowance for families with incomes well below average wage.

Family allowances deducted from the tax base. Supplementary family allowances can be claimed.

Additional allowance for spouse in common household subject to spouse’s income. Child tax credit deducted from tax liability - any excess paid to taxpayer.

Income splitting - tax credits for each spouse. Single parent gets more tax credit than unmarried taxpayer but less than married couple.

Couple taxed on 2 times tax on half income. Singles with children can use income splitting - quotient is 2. Tax credit for each child.

Separate rate schedule for married opting for joint taxation and also single parents. Allowance for child care cost - may be transferred to other spouse. Cash payments for dependent children - single parents get extra child support.

Means tested ‘tax credits’ classified by OECD as universal cash transfers covers children and families. Credits provide a guaranteed minimum income.

Notes

The Taxation of Families – International Comparisons 2011

The Taxation of Families â&#x20AC;&#x201C; International Comparisons 2011

Appendix B â&#x20AC;&#x201C; Tax Burden 2000-2011 Household type Wage as % of average wage

Single no child

Single two children

Married two children

Married no children

100

167

100

100,33

100,67

100,33

United Kingdom 2000 2003 2004 2005 2006 2007 2008 2009 2010 2011

22.7 23.6 23.7 23.8 23.8 24.0 22.9 22.4 22.6 21.7

25.8 26.7 26.8 26.9 26.9 27.0 25.6 25.2 25.4 25.1

28.8 30.3 30.5 30.5 30.6 30.8 30.3 29.7 30.0 30.4

7.4 4.7 4.8 5.0 5.8 7.3 2.7 -0.6 0.3 -1.7

20.6 19.8 20.1 20.2 20.3 20.6 19.0 18.4 18.7 18.4

18.8 18.4 18.7 18.8 18.9 19.2 18.0 17.2 17.5 17.8

21.4 21.3 21.5 22.7 22.0 22.6 21.3 20.7 21.1 20.7

22.7 23.6 23.7 23.8 23.8 24.0 22.9 22.4 22.6 21.7

OECD 2000 2003 2004 2005 2006 2007 2008 2009 2010 2011

21.9 21.5 21.5 21.3 21.1 21.1 20.6 20.2 20.2 20.8

25.8 25.3 25.4 25.2 25.3 25.4 24.9 24.5 24.5 24.9

31.3 31.1 31.2 30.9 30.8 30.9 30.5 30.1 30.1 30.4

4.7 4.2 4.2 4.2 3.5 3.7 2.9 2.0 2.4 2.3

14.9 14.6 14.5 14.2 13.8 13.7 13.1 12.5 12.7 13.0

17.6 17.0 16.9 16.8 16.4 16.2 15.7 15.3 15.4 15.6

20.3 19.6 19.6 19.5 19.3 19.2 18.8 18.4 18.6 19.0

22.8 22.2 22.2 22.0 22.0 22.0 21.7 21.1 21.1 21.6

EU(15) 2000 2003 2004 2005 2006 2007 2008 2009 2010 2011

25.7 24.7 24.8 24.7 24.5 24.3 24.1 23.7 23.8 24.9

30.3 29.4 29.1 29.2 29.3 29.2 29.0 28.7 28.8 29.8

36.7 36.0 36.1 36.0 36.1 36.1 36.0 35.7 35.7 36.9

9.2 7.1 7.1 6.8 5.9 6.0 5.8 4.1 4.4 4.4

18.0 17.2 16.6 16.6 16.6 16.7 16.7 16.0 16.4 16.9

20.8 18.8 18.8 18.8 18.9 18.6 18.6 18.0 18.4 18.9

23.7 22.2 22.3 22.3 22.3 22.2 22.1 21.6 21.9 22.8

26.5 25.1 25.0 25.0 24.9 24.7 24.8 24.4 24.5 25.2

EU(21) 2000 2003 2004 2005 2006 2007 2008 2009 2010 2011

25.4 24.5 24.5 24.1 23.9 23.9 23.7 23.3 23.4 24.4

29.4 28.6 28.8 28.6 28.6 28.6 28.4 28.0 27.9 28.8

35.1 34.7 34.8 34.5 34.6 34.6 34.4 34.0 33.9 34.6

6.1 5.0 5.1 5.1 4.5 4.8 4.3 3.2 3.6 3.3

15.8 15.3 15.3 15.0 14.9 14.8 14.5 14.0 14.2 14.3

19.4 18.3 18.3 18.1 18.0 17.5 17.4 16.9 17.0 17.4

22.7 21.7 21.7 21.5 21.4 21.1 20.9 20.6 20.6 21.3

26.1 25.1 25.0 24.8 24.7 24.7 24.5 24.0 23.9 24.7

Source: Taxing Wages 2010-2011 Tables II.1c, II.2c, II.3c, II.4c, II.5c, II.6c, II.7c, II.8c

The Taxation of Families â&#x20AC;&#x201C; International Comparisons 2011

Appendix C â&#x20AC;&#x201C; Tax Burden by Family Type and Wage Level 2011 Household type

Single no child

Wage as % of average wage Australia Austria Belgium Canada Chile Czech Republic Denmark Estonia Finland France Germany Greece Hungary Iceland Ireland Israel Italy Japan Korea Luxembourg Mexico Netherlands New Zealand Norway Poland Portugal Slovakia Slovenia Spain Sweden Switzerland Turkey United Kingdom United States

Single no child

Single two children

Married two children

Married no children

100

167

100

100,33

100,67

100,33

15.9 27.3 35.6 17.5 7.0 18.9 36.8 17.7 23.1 26.1 34.9 .. 29.5 23.1 12.8 9.4 26.7 19.5 9.4 20.5 1.0 26.8 12.9 25.6 23.6 17.3 19.4 28.8 17.7 22.1 13.0 24.8 21.7 19.6

22.3 33.4 42.2 22.7 7.0 23.0 38.4 19.6 29.8 28.0 39.9 .. 35.0 28.3 18.9 16.1 30.8 21.0 12.3 28.1 6.3 31.4 15.9 29.3 24.6 24.5 22.9 33.4 21.9 24.8 16.1 27.4 25.1 22.8

28.2 38.5 49.1 26.8 7.8 26.2 44.8 21.0 36.9 33.6 43.8 .. 37.8 32.9 32.1 24.7 37.9 24.8 15.3 36.6 13.6 37.4 22.0 35.7 25.4 32.9 25.5 39.3 26.7 35.4 20.7 31.2 30.4 28.6

-12.3 5.4 17.3 -18.7 6.0 -12.0 11.4 -1.7 9.8 14.8 17.6 .. -2.8 11.5 -38.0 -4.0 6.3 8.3 8.7 -9.6 1.0 3.1 -18.7 11.1 17.8 5.6 3.6 -1.4 8.5 11.3 -3.2 23.4 -1.7 -1.3

10.1 18.7 22.3 9.4 7.0 -4.9 27.4 7.6 23.7 17.9 21.0 .. 13.6 14.2 -2.9 12.1 18.9 12.1 9.6 2.7 6.3 23.6 -1.2 22.0 17.8 12.4 5.3 10.8 14.5 17.6 2.8 25.8 18.4 10.4

13.0 18.9 26.6 15.0 4.9 7.2 32.2 11.5 21.0 18.5 26.8 .. 15.5 21.3 4.5 8.3 21.1 14.4 9.7 7.5 2.2 22.4 7.0 22.9 19.2 13.8 11.1 19.4 16.6 17.1 5.7 27.0 17.8 14.6

19.7 23.1 33.0 18.5 6.6 12.5 33.9 13.8 23.5 22.5 31.1 .. 20.0 25.5 10.3 9.5 24.8 15.9 9.8 13.5 4.2 24.7 13.1 24.9 20.7 21.0 15.1 23.5 18.0 19.4 8.9 27.7 20.7 17.2

18.3 28.6 34.8 19.4 7.0 20.0 37.0 17.7 25.6 26.1 34.9 .. 31.5 23.4 12.2 12.9 26.7 20.0 11.3 18.9 2.2 27.5 14.8 26.5 23.6 18.3 19.0 30.6 18.0 22.5 13.6 27.7 21.7 20.3

20.8 24.9 24.4

24.9 29.8 28.8

30.4 36.9 34.6

2.3 4.4 3.3

13.0 16.9 14.3

15.6 18.9 17.4

19.0 22.8 21.3

21.6 25.2 24.7

Unweighted averages OECD EU(15) EU(21)

Source: Taxing Wages 2010-2011 Table I.3

The Taxation of Families â&#x20AC;&#x201C; International Comparisons 2011

Appendix D â&#x20AC;&#x201C; Tax Burden on Families Compared with Singles without Children 2011 Household type Wage as % of average wage

1 Single no child

2 Single no child

3 Single no child

4 Single two children

5 Married two children

6 Married two children

7 Col 4 as % of Col 1

8 Col 5 as % of Col 2

9 Col 6 as % of Col 3

100

167

100

100,67

15.9 27.3 35.6 17.5 7.0 18.9 36.8 17.7 23.1 26.1 34.9 .. 29.5 23.1 12.8 9.4 26.7 19.5 9.4 20.5 1.0 26.8 12.9 25.6 23.6 17.3 19.4 28.8 17.7 22.1 13.0 24.8 21.7 19.6

22.3 33.4 42.2 22.7 7.0 23.0 38.4 19.6 29.8 28.0 39.9 .. 35.0 28.3 18.9 16.1 30.8 21.0 12.3 28.1 6.3 31.4 15.9 29.3 24.6 24.5 22.9 33.4 21.9 24.8 16.1 27.4 25.1 22.8

28.2 38.5 49.1 26.8 7.8 26.2 44.8 21.0 36.9 33.6 43.8 .. 37.8 32.9 32.1 24.7 37.9 24.8 15.3 36.6 13.6 37.4 22.0 35.7 25.4 32.9 25.5 39.3 26.7 35.4 20.7 31.2 30.4 28.6

-12.3 5.4 17.3 -18.7 6.0 -12.0 11.4 -1.7 9.8 14.8 17.6 .. -2.8 11.5 -38.0 -4.0 6.3 8.3 8.7 -9.6 1.0 3.1 -18.7 11.1 17.8 5.6 3.6 -1.4 8.5 11.3 -3.2 23.4 -1.7 -1.3

10.1 18.7 22.3 9.4 7.0 -4.9 27.4 7.6 23.7 17.9 21.0 .. 13.6 14.2 -2.9 12.1 18.9 12.1 9.6 2.7 6.3 23.6 -1.2 22.0 17.8 12.4 5.3 10.8 14.5 17.6 2.8 25.8 18.4 10.4

19.7 23.1 33.0 18.5 6.6 12.5 33.9 13.8 23.5 22.5 31.1 .. 20.0 25.5 10.3 9.5 24.8 15.9 9.8 13.5 4.2 24.7 13.1 24.9 20.7 21.0 15.1 23.5 18.0 19.4 8.9 27.7 20.7 17.2

-78 20 49 -107 86 -64 31 -10 43 57 50 .. -9 50 -296 -43 23 42 92 -47 100 12 -144 43 76 33 19 -5 48 51 -25 94 -8 -7

46 56 53 41 100 -21 71 39 79 64 53 .. 39 50 -15 75 61 58 78 10 100 75 -8 75 72 51 23 32 66 71 17 94 73 45

70 60 67 69 85 47 76 66 64 67 71 .. 53 77 32 39 65 64 64 37 31 66 60 70 82 64 59 60 68 55 43 89 68 60

Unweighted averages OECD 20.8 EU(15) 24.9 EU(21) 24.4

24.9 29.8 28.8

30.4 36.9 34.6

2.3 4.4 3.3

13.0 16.9 14.3

19.0 22.8 21.3

11 18 13

52 57 50

62 62 62

Australia Austria Belgium Canada Chile Czech Republic Denmark Estonia Finland France Germany Greece Hungary Iceland Ireland Israel Italy Japan Korea Luxembourg Mexico Netherlands New Zealand Norway Poland Portugal Slovakia Slovenia Spain Sweden Switzerland Turkey United Kingdom United States

Source: Taxing Wages 2010-2011 Table I.3 for columns 1-6; columns 7-9 derived as shown

The Taxation of Families – International Comparisons 2011

Appendix E – Marginal Effective Tax Rates 2011 Household type Wage as % of average wage

Single person, two children 36%

50%

75%

100%

36%

50%

75%

100%

58.9% 15.1% 40.8% 21.7% 7.0% 11.0% 40.9% 23.2% 28.4% 20.7% 37.5% .. 17.5% 0.0% 61.6% 3.5% 9.5% 15.7% 8.1% 13.2% 7.4% 0.0% 100.0% 25.7% 17.8% 11.0% 78.4% 22.1% -16.1% 28.9% 6.2% 28.4% 73.0% 37.6%

73.9% 43.7% 59.3% 35.7% 7.0% 31.1% 40.9% 23.2% 32.3% 37.2% 42.7% .. 17.5% 46.3% 62.8% 32.9% 40.5% 21.9% 10.4% 13.3% 7.6% 34.5% 17.5% 35.8% 17.8% 157.3% 82.5% 22.1% -24.0% 28.1% 12.1% 32.7% 73.0% 47.6%

55.5% 44.4% 54.9% 60.7% 7.0% 40.7% 40.9% 23.2% 42.6% 21.5% 46.6% .. 37.8% 43.4% 69.5% 12.0% 48.9% 23.0% 10.4% 44.2% 12.5% 47.9% 37.5% 35.8% 17.8% 39.0% 29.9% 34.6% 28.8% 28.9% 16.1% 32.7% 73.0% 52.6%

51.5% 49.1% 54.9% 65.0% 7.0% 40.7% 42.3% 23.2% 47.5% 26.1% 51.8% .. 53.1% 43.4% 72.4% 35.0% 53.5% 26.7% 17.5% 49.8% 302.8% 48.1% 50.0% 44.8% 17.8% 82.4% 29.9% 34.6% 32.6% 31.1% 16.3% 32.7% 32.0% 27.4%

63.0% 15.1% 0.0% 21.7% 7.0% 11.0% 40.9% 2.8% 28.4% 20.7% 20.6% .. 17.5% 0.0% 61.6% 3.5% 9.5% 15.7% 8.1% 13.2% 7.4% 21.3% 100.0% 25.7% 17.8% 11.0% 78.4% 22.1% -16.1% 28.9% 6.2% 15.7% 73.0% 12.4%

79.0% 43.7% 54.0% 35.7% 7.0% 11.0% 40.9% 2.8% 32.3% 37.2% 34.3% .. 17.5% 0.0% 61.6% 42.9% 9.5% 16.2% 8.1% 13.3% 7.6% 42.8% 17.5% 35.8% 17.8% 132.9% 78.4% 22.1% -24.0% 28.1% 10.1% 32.7% 73.0% 37.6%

55.5% 44.4% 46.3% 60.7% 7.0% 11.0% 40.9% 23.2% 42.6% 21.5% 41.6% .. 37.8% 46.3% 64.4% 26.0% 49.6% 23.0% 10.4% 24.5% 12.5% 47.9% 37.5% 35.8% 17.8% 26.0% 13.4% 22.1% 38.2% 28.9% 14.4% 32.7% 73.0% 47.6%

51.5% 49.1% 54.9% 65.0% 7.0% 38.4% 42.3% 23.2% 47.5% 26.1% 43.4% .. 53.1% 46.3% 72.4% 35.0% 40.7% 23.4% 17.5% 29.9% 12.5% 48.1% 50.0% 44.8% 17.8% 28.5% 29.9% 34.6% 28.8% 31.6% 17.1% 32.7% 32.0% 27.4%

Unweighted averages OECD 25.9% EU(15) 26.0% EU(21) 26.7%

36.9% 45.8% 41.8%

36.8% 45.1% 40.8%

48.3% 48.1% 43.6%

23.2% 23.4% 23.9%

32.1% 41.4% 36.4%

34.1% 42.1% 35.8%

36.4% 41.1% 38.6%

Source: OECD ‘Statlink’ data pp. 107-139

One-earner couple, two children

the taxation of families – international comparisons 2011

The review challenges the way in which UK families are taxed. All policy makers need to take note of the international evidence presented, and take appropriate steps to redress the imbalances. Rt. Rev Dr Peter Forster, the Lord Bishop of Chester

ISBN 978-0-905195-16-2

£6.00

“