For several years, the high cost of living in the UK has been recognised by the political classes as an area which requires an urgent and concerted policy response. However all too often, these policy responses focus on demand and fail to address underlying issues. All too often, government is responsible for many of the problems. Tax is perhaps the biggest culprit of all and politicians need to recognise that the reason many people struggle to make ends meet in the first place is due to the high tax burden.
This research note provides an estimate of the total amount of tax paid by different types of households over their lifetimes. The figure includes both direct and indirect taxes and is calculated on the basis of the current level of taxes applying over a working lifetime of 40 years and 15 years of retirement.