[wdmmg-discuss] What Tax Do I Pay?

Wed Apr 7 12:45:56 UTC 2010

We have made some progress with the tax calculator this morning.

We have named it "What Tax Do I Pay?"

We have a simple way of roughly calculating the tax an individual will 
pay. Here are more details for those interested -- we need most help on 
calculating the cost of owning a car (part 4 below).

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1. We ask for income (by financial year) and we can use this table of
    income tax stats to determine roughly how much income tax the
    individual paid: table 2.5 on
    http://www.hmrc.gov.uk/stats/income_tax/menu.htm

2. We take the UK National Insurance contributions for this year (98.0
    Billion GBP) divided by the population of the UK (61 million), and add
    these to the income tax figure. We do the same for Corporation tax
    (41.8 Billion GBP).

3. We ask for disposable income and apply VAT tax to this and add this to
    our total.

4. We ask if the person has a car, if so divide the tax from hydrocarbon
    Oils (24.7 Billion GBP) by the 77 percent of the population who own a
    car and add this to our total (figure for car ownership from page 5 of
    the RAC survey
    http://webcache.googleusercontent.com/search?q=cache:Dxh4sioBVnoJ:www.racfoundation.org/assets/rac_foundation/content/downloadables/car%2520ownership%2520in%2520great%2520britain%2520-%2520leibling%2520-%2520171008%2520-%2520report.pdf+car+ownership+RAC&cd=5&hl=en&ct=clnk&gl=uk&client=opera
    figure for 2007).

5. We ask if the person smokes, if so we divide the Tobacco tax (7.9
    Billion GBP) by the 21 percent of the population who smoke and add this
    to the total (figures for percentage of smokers from
    http://www.statistics.gov.uk/cci/nugget.asp?id=313 figure for 2007)

For the output of the calculator, to show the effect of the taxes paid, 
divide the total tax into the government spending from table 5.2 of PESA 
2009 http://www.hm-treasury.gov.uk/d/pesa09_chapter5.xls