UHY Hacker Young report finds UK economy over-taxed

According to research by UHY Hacker Young, Top 50 firm, the UK economy is paying way over the global tax average. Britain has a tax burden of 18% above everyone else around the world.

So yes, it is fair to say that we are somewhat over-taxed as a nation.

The high effective rate of 32.9% GDP could well be meaning that our growth could be in jeopardy; the global average is 27.8% of GDP. The US is at 25.4% GDP and Ireland is at 28.3% - even Japan come in at 29.5%.

In saying this, many of our European counterparts also have high tax burdens, with most coughing up around 40% in tax.

The report by UHY Hacker Young warned that such high tax can put off investors, which has knock on effects when it comes to large corporations choosing to locate their bases outside the UK where the tax burden is lower.

UHY Hacker Young tax partner, Roy Maugham, said;

"While our tax burden compares favourably with some of our Western European neighbours, increasingly, that is not where the most intense competition is coming from. It needs to be a clear ambition to make our economy globally competitive by keeping a close eye on the overall tax take - perhaps even setting a specific target.

"That will need to be balanced by greater efforts to ensure that spending on the public sector delivers the best results for its customers.

"How much tax is too much ought to be discussed much more openly during the election campaign."

What do you think of the latest report? Are we running the risk of falling behind with the rest of the world due to our high taxes? Let us know your thoughts @OmnitasTax & join in the conversation on Facebook – with the General Election only weeks away, the debate is certainly sure to be a lively one!