The Evolution of the UK Tax Base: New SPERI Brief

Policy Brief No. 5

We are pleased to announce that the fifth British Political Economy Brief in the series has now been published.

In this Brief the Sheffield Political Economy Research Institute (SPERI) considers the changing tax base of the UK state.

Taxation takes many different forms, encompassing progressive taxes such as income tax, regressive taxes such as Value Added Tax, and taxes targeted on private enterprises such as corporation tax. The economic downturn significantly affected tax revenues, and the Coalition Government since 2010 has sought to cut some taxes, to boost economic recovery, but at the same time raise others, in support of deficit reduction. It is important to consider, therefore, what impact these changes have had on the nature of the UK tax base as a whole. The evidence shows that regressive taxes now make up a higher proportion of tax revenues, and both progressive individual taxes and taxation targeted on private enterprises make up a lower proportion. Furthermore, revenue from business taxes is set to contract even further, even as economic growth returns, as proposed cuts are fully implemented.

Free to download: SPERI British Political Economy brief No. 5: The evolution of the UK tax base