When was Income Tax First Enacted in Britain?
Published by Campbell M Gold in Political · Wednesday 20 Nov 2024 · 4:15
Tags: Income, Tax, Britain, 1799, William, Pitt, the, Younger, taxation, history, British, system, war, France, expenditures, borrowing
Tags: Income, Tax, Britain, 1799, William, Pitt, the, Younger, taxation, history, British, system, war, France, expenditures, borrowing
Income Tax First Enacted in Britain - 1799
With all of UK PM Kier Starmer's tax screwing, I started to wonder when did it all start - when was Income Tax first enacted in Britain?
It all started in 1799
William Pitt the Younger* was a reforming prime minister who was determined to do what he could to rationalise the British system of taxation.
However, in 1793, when Britain found itself at war with revolutionary France, enormous expenditures on the army and navy required unprecedented borrowing and increased taxation.
Unfortunately, increases to "Indirect Taxes" and a new "Inheritance Tax" were not enough, and in 1799 Pitt introduced a "Tax on Incomes".
Under this new "Income Tax," all annual incomes over £200 were taxed at 10 percent, while those between £60 and £200 were taxed at a graduated rate from just under 1 percent to 10 percent. No one was taxed on incomes below £60.
Though initially very unpopular, Income Tax eventually came to be accepted as a necessary price for winning the war against Napoleon. Indeed, many citizens regarded paying the tax as a "patriotic duty". However, after winning the war, Income Tax was never rescinded.
(*William Pitt (28 May 1759 - 23 Jan 1806 - age 46) was a British statesman, the youngest (24 years old) and last prime minister of Great Britain from 1783 until the Acts of Union 1800, and then first prime minister of the United Kingdom from January 1801. He left office in March 1801, but served as prime minister again from 1804 until his death in 1806.)
World War 1
Any plans to try to equalise the way in which the tax burden was now borne by taxpayers had to be set aside by the outbreak of World War 1 in 1914.
Confident of the support of the British public, Parliament authorised tax increases to support unprecedented levels of wartime expenditure.
The standard rate of Income Tax, which was 6 per cent in 1914, stood at 30 per cent in 1918. There was also a substantial rise in the number of people paying income tax. In 1914 the figure was 1.13 million and by 1920 it had risen to 3 million. However, in the early 1920s the number fell to around 2.2 million. By now some 60 per cent of tax revenue was from direct taxation, most of which came from Income Tax and Super Tax.
Some of my favourite taxation related quotes
It is terrible to contemplate how few politicians are hanged.
(G. K. Chesterton)
We don't pay taxes. Only the little people pay taxes.
(Anon Elitist)
We have a system that increasingly taxes work and subsidises non-work.
(Milton Friedman) This is so true in the UK!
You've seen my statements; I do very well. I don't mind paying some taxes. The middle class is getting clobbered in this country. You know the middle class built this country, not the hedge fund guys, but I know people in hedge funds that pay almost nothing, and it's ridiculous, OK?
(Donald Trump)
Greece has been, in many ways, a partially dysfunctional society. For example, the wealthy barely pay taxes... to an extent, that's true elsewhere, including the United States, but it's been pretty extreme in Greece.
(Noam Chomsky)
When the federal government spends more each year than it collects in tax revenues, it has three choices: It can raise taxes, print money, or borrow money. While these actions may benefit politicians, all three options are bad for average Americans.
(Ron Paul)
We don't need new taxes. We need new taxpayers, people that are gainfully employed, making money and paying into the tax system. And then we need a government that has the discipline to take that additional revenue and use it to pay down the debt and never grow it again.
(Marco Rubio)
Collecting more taxes than is absolutely necessary is legalised robbery.
(Calvin Coolidge)
Corporations do not pay taxes, they collect them, passing the burden to consumers as a cost of production. And corporate taxation is a feast of rent-seeking - a cornucopia of credits, exemptions and other subsidies conferred by the political class on favoured, and grateful, corporations.
(George Will) Government/Elite cronyism is a pandemic here in the UK!
Any politician promising not to raise your taxes is like a vampire promising to become a vegetarian.
(Pierre Poilievre)
One of the penalties for refusing to participate in politics is that you end up being governed by your inferiors.
(Plato)
There you have it…
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