Cast off the burden and ride free: Robert Chote charts the history of a tax that has plagued citizens of the United Kingdom since 1799, but from which our contest offers a holiday of up to 10 years

WHEN income tax was introduced in 1799 an outraged elector was moved to write to Parliament: 'It is a vile, Jacobin pumped-up Jack-in- the-Office piece of impertinence - is a true Briton to have no privacy? Are the fruits of his labour and toil to be picked over, farthing by farthing, by the pimply minions of bureaucracy?'

He was not alone in his complaint. Despite reforms to lessen its impact on the well-off, income tax remained enormously unpopular and had to be abolished after the Battle of Waterloo in 1816.

Robert Peel reintroduced it 25 years later at a rate of 3 per cent, and it has remained in place as one of the most effective ways for Chancellors of the Exchequer to raise revenue for the government.

Income tax has grown steadily in importance in Britain and in most other countries. In 1872 income tax raised only pounds 7m compared to the pounds 47m raised by Customs and Excise from taxes on spending and trade. During this financial year, income tax should raise around pounds 64.4bn, compared to the pounds 73.9bn to be collected by Customs & Excise.

Public discontent about the growth and intrusiveness of taxes has thrown up a succession of folk heroes, from William Tell to Lady Godiva. The American War of Independence and the French Revolution were both triggered to a large extent by arguments over tax.

The rebels invoved in these conflicts would no doubt be horrified to discover the range of human activities in which tax-collectors take an interest in modern Britain.

For example, we pay taxes when we work, shop, buy a house, drive a car, make a profit, give money away and when we die.

By raising taxes from a variety of different sources, the Government disguises how much in total people have to hand over to it. This is a practical illustration of what Jean- Baptiste Colbert, Louis XIV's finance minister, famously described as the art of taxation: 'Plucking the goose so as to obtain the largest amount of feathers with the least amount of hissing.'

But Gabriel Stein of the Adam Smith Institute has made an admirable attempt to clear the fog. He has calculated that, on average, people in Britain have spent all the year so far working exclusively for the Government - and that they will continue to hand over all their income for at least another fortnight. Only on 24 May will we stop handing our income to Kenneth Clarke and keep it for ourselves.

This 'tax freedom day' is five days later than it was in 1993, reflecting the first tranches of tax increases announced by Mr Clarke and his predecessor in their Budgets last year. In 1965, tax freedom day was as early as 29 April, and in 1982 as late as 6 June.

If the Government raised enough from taxes to cover everything it spent - rather than borrowing pounds 46bn last year to make up the shortfall - then tax freedom day would be on 12 June.

But Britain does relatively well compared to most other rich industrial nations. In 1992 we worked for 142 days a year purely to pay our taxes, compared with an average for the European Union of 164 days. The Swedes worked for 196 days to pay their taxes, and the Germans 158, but the Americans needed only 121 and the Australians 118.

Taxes pay for government spending on goods and services - like defence, street lighting and schools - but also to help redistribute income and wealth from the well-off to the less fortunate.

In the early days of income tax it was paid by less than half a million people, with the number rising above a million only in the early 1900s. Even by the Second World War, a married couple on average earnings paid no income tax.

But following the decision to finance wartime government spending largely through higher taxes - and then the expansion of the Welfare State which followed it - the need for revenue had grown so much that the net had be spread much wider.

Most perniciously, taxes have been introduced that are disguised not to look like taxes at all. This is true of the television licence (which viewers have to fork out for even if they never watch the BBC - which the tax supports); and national insurance contributions, which operate in almost exactly the same way as income tax, but get nowhere near the same public and political attention.

Governments also tend to prefer taxes that produce a growing revenue as time goes by, so that usually they do not need to increase them explicitly to pay for higher spending.

The paradox for politicians and tax raisers is that people say they still want better and more expensive public services, they tell opinion pollsters that they would be happy to pay for it with higher taxes, but then they vote for the party which promises - if not delivers - the lowest tax bill.

So to have someone else pay your income tax for 10 years, with no impact on the services you receive, should be tempting indeed.

PROMOTED VIDEO
Extras
indybest
Travel
Flocking round: Beyoncé, Madame Tussauds' latest waxwork, looking fierce in the park
travelIn a digital age when we have more access than ever to the stars, why are waxworks still pulling in crowds?
Arts and Entertainment
tv
Arts and Entertainment
Judi Dench appeared at the Hay Festival to perform excerpts from Shakespearean plays
tvJudi Dench and Hugh Bonneville join Benedict Cumberbatch in BBC Shakespeare adaptations
Sport
Is this how Mario Balotelli will cruise into Liverpool?
football
News
Ronahi Serhat, a PKK fighter, in the Qandil Mountains in Iraqi Kurdistan
i100
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
Arts and Entertainment
Poet’s corner: Philip Larkin at the venetian window of his home in 1958
booksOr caring, playful man who lived for others? A new book has the answer
Arts and Entertainment
Exhibition at the Centre Pompidou in Metz - 23 May 2012
art
News
Matthew McConaughey and his son Levi at the game between the Boston Red Sox and the Houston Astros at Fenway Park on August 17, 2014 in Boston, Massachusetts.
advertisingOscar-winner’s Lincoln deal is latest in a lucrative ad production line
Arts and Entertainment
Alfred Molina, left, and John Lithgow in a scene from 'Love Is Strange'
film
News
i100
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Junior Quant Analyst - C++, Boost, Data Mining

£25000 - £35000 per annum: Harrington Starr: Junior Quant Analyst - C++, Boost...

Service Desk Analyst- (Desktop Support, Help desk)

£25000 - £35000 per annum: Harrington Starr: Service Desk Analyst- (Desktop Su...

Junior Quant Analyst (Machine Learning, SQL, Brokerage)

£30000 - £50000 per annum: Harrington Starr: Junior Quant Analyst (Machine Lea...

UNIX Application Support Analyst- Support, UNIX, London

£45000 - £55000 per annum: Harrington Starr: UNIX Application Support Analyst-...

Day In a Page

Air strikes? Talk of God? Obama is following the jihadists’ script

Air strikes? Talk of God? Obama is following the jihadists’ script

The President came the nearest he has come yet to rivalling George W Bush’s gormless reaction to 9/11 , says Robert Fisk
Ebola outbreak: Billy Graham’s son declares righteous war on the virus

Billy Graham’s son declares righteous war on Ebola

A Christian charity’s efforts to save missionaries trapped in Africa by the crisis have been justifiably praised. But doubts remain about its evangelical motives
Jeremy Clarkson 'does not see a problem' with his racist language on Top Gear, says BBC

Not even Jeremy Clarkson is bigger than the BBC, says TV boss

Corporation’s head of television confirms ‘Top Gear’ host was warned about racist language
Nick Clegg the movie: Channel 4 to air Coalition drama showing Lib Dem leader's rise

Nick Clegg the movie

Channel 4 to air Coalition drama showing Lib Dem leader's rise
Philip Larkin: Misogynist, racist, miserable? Or caring, playful man who lived for others?

Philip Larkin: What will survive of him?

Larkin's reputation has taken a knocking. But a new book by James Booth argues that the poet was affectionate, witty, entertaining and kind, as hitherto unseen letters, sketches and 'selfies' reveal
Madame Tussauds has shown off its Beyoncé waxwork in Regent's Park - but why is the tourist attraction still pulling in the crowds?

Waxing lyrical

Madame Tussauds has shown off its Beyoncé waxwork in Regent's Park - but why is the tourist attraction still pulling in the crowds?
Texas forensic astronomer finally pinpoints the exact birth of impressionism

Revealed (to the minute)

The precise time when impressionism was born
10 best men's skincare products

Face it: 10 best men's skincare products

Oscar Quine cleanses, tones and moisturises to find skin-savers blokes will be proud to display on the bathroom shelf
Middle East crisis: We know all too much about the cruelty of Isis – but all too little about who they are

We know all too much about the cruelty of Isis – but all too little about who they are

Now Obama has seen the next US reporter to be threatened with beheading, will he blink, asks Robert Fisk
Neanderthals lived alongside humans for centuries, latest study shows

Final resting place of our Neanderthal neighbours revealed

Bones dated to 40,000 years ago show species may have died out in Belgium species co-existed
Scottish independence: The new Scots who hold fate of the UK in their hands

The new Scots who hold fate of the UK in their hands

Scotland’s immigrants are as passionate about the future of their adopted nation as anyone else
Britain's ugliest buildings: Which monstrosities should be nominated for the Dead Prize?

Blight club: Britain's ugliest buildings

Following the architect Cameron Sinclair's introduction of the Dead Prize, an award for ugly buildings, John Rentoul reflects on some of the biggest blots on the UK landscape
eBay's enduring appeal: Online auction site is still the UK's most popular e-commerce retailer

eBay's enduring appeal

The online auction site is still the UK's most popular e-commerce site
Culture Minister Ed Vaizey: ‘lack of ethnic minority and black faces on TV is weird’

'Lack of ethnic minority and black faces on TV is weird'

Culture Minister Ed Vaizey calls for immediate action to address the problem
Artist Olafur Eliasson's latest large-scale works are inspired by the paintings of JMW Turner

Magic circles: Artist Olafur Eliasson

Eliasson's works will go alongside a new exhibition of JMW Turner at Tate Britain. He tells Jay Merrick why the paintings of his hero are ripe for reinvention