EwanI Ted
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- Feb 28, 2018
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I'd go one step further and say the majority of Conservatives in power over the last 9 years have been tax and spend Blairites, rather than any kind of right wing austerity loons. The only difference being that Blair's tenure was during a global boom where growth was much higher.
Current tax levels as a % of GDP are up there with the highest they've ever been in a non-recession peacetime period. UK spend to GDP follows the same trend - our spend to GDP in 2000 under Blair was just over 34% compared with current spend at over 38% (see final image).
The amount of tax that is paid by the highest earners is likewise at a high. For example the mean amount of tax paid by all people earning over £2m is £1.88m (39%). The amount for people earning between £1m and £2m is £546k (40%). The mean amount of income tax paid for people earning between £500k and £1m is £271k (40%). Likewise the amount of income tax paid by the lowest earners is at its lowest level. People earning up to £12500 pay an average of £222 (1.6%). People earning between £12.5k and £15k pay an average of £871 of 5% and people earning between £15k and £20k pay £2.2k (9%). The poorest 50% of taxpayers pay less income tax than ever before and the richest 1% and 10% pay a far greater proportion than ever before.
At the same time the minimum wage has grown at a faster rate than before by an average of 24p per annum between 2010 and 2019 from £6.08 to £8.21 (3.5% per annum - 35% total), compared with inflation at 2.7% average.
Corporation tax receipts to GDP have grown from 2.2% (£26.5b) back in 2002 to 2.7% (£52.5b) in 2017 and are forecasted to be over £59b this year.
Likewise they've targeted big business and nearly tripled revenue in terms of insurance tax from £2.3m to £6.2b. The tax rate likewise has tripled from 4% in 1999 compared with the current rate of 12%.
Even the much criticised UK Public Health spend as a % of GDP is close to a record high at nearly 7.5%, compared with under 5% back in 2000 or 6.5% back in 2007. A further inflation busting 3.4% per annum has been allocated for the next 4 years.
UK pension spend is also at a historic high.
This is why I'm always confused by the accepted "austerity" caricature that was peddled by Labour and then worn as a badge of honour by the Tories to seem fiscally responsible. The below graph is a good illustration, given that there was a global recession the ability to increase spending year on year is quite phenomenal. Compare it to the actual austerity that is occurring across Europe and it's actually somewhat insensitive.
At the same time people state that pretty much every government department is experiencing austerity. It's a complete oxymoron.
The GDP to public spend ratio doesnt really support this argument. Or at least, suggests there's more to it than you're making out. It increased at a historic rate under Blair, and fell at a rate comparable to Thatcher under Cameron/Osborne.