Energy has become particularly costly in 2022. Since August last year, 26 energy suppliers in the UK have gone bust. This threatens to lead to regular government bailouts of the energy industry. At the same time, there are a number of punishing green taxes paid by households through their energy bills.
As part of an exclusive in today's Sunday Telegraph our research reveals that these taxes cost the UK taxpayer £11.5 billion in 2020-21. Worse still, the green tax burden this year is forecast to be the highest on record at £12.5 billion!
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These taxes are damaging to millions of households' finances. That's why we've created a tool to show just how much green levies are costing you. For example, a typical dual fuel bill is around £1,250 a year. This means a consumer is paying nearly £192 in green levies!
Not only are green levies contributing to the 70-year high tax burden, they’re also hammering households by artificially inflating prices. We're calling on ministers to get to grips with these green levies before committing the taxpayer to pay for more energy bailouts.
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Dry January could save taxpayers £1 billion in booze duties
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For some people the New Year means giving up alcohol for the first month, commonly known as Dry January. New anaylsis by the TPA has revealed if everyone in the country went sober for a month, drinkers would save over £1 billion in duties. The average household spends more than £460 in alcohol duties alone each year. These figures show how ludicrously high alcohol taxes have left Brits shortchanged.
But now there are calls to make drinks even more expensive in the form of Minimum Unit Pricing (MUP). Wales and Scotland have already introduced it and the Republic of Ireland has recently followed suit. Many people want Northern Ireland to adopt the policy too.
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Taking part in a discussion on BBC Radio Ulster I stood up for hard-working taxpayers and argued that these proposals fly in the face of common sense. Proponents of MUP argue that it reduces the strain on healthcare services. However, as the TPA has previously explored the evidence doesn't support this claim. In reality, what happens is that those on the lowest incomes see their weekly shop get more expensive.
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Both taxpayers and the hospitality industry are crying out for politicians to ease the squeeze on their wallets this year. Ministers must sober up to the cost of living crisis, resist calls for more levies and cut taxes for hard-hit households and businesses. Cheers!
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TaxPayers' Alliance in the news
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The cost of living
With energy prices soaring, taxes set to rise and big increases in inflation many families are finding it harder to make ends meet every month. New research from the Resolution Foundation suggests on average bills will rise by £1,200 for households.
Speaking to a primetime audience on GBNews, our chief executive John O'Connell took the opportunity to argue that the government must making savings instead of clobbering taxpayers.
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For example, doing away with national pay bargaining and cutting the hugely unpopular overseas aid budget would remove the need for a hike in national insurance. Undoubtedly the government has tough decisions to make but its current policies are going to hit the poorest hardest.
That's why the TPA will be doing everything possible this year to reverse the Tory tax rises and give Brits some much needed financial breathing room.
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MPs' could get pay rise to £84,000
A decision on whether MPs will get a pay rise this year is expected next week. Some are warning that if IPSA (the body responsible for setting MPs' pay) follows normal rules then parliamentarians could see their pay packets bulge by 2.7 per cent.
Due to the pandemic, IPSA suspended its rules and it now has the power to freeze or at the very least reduce the size of any pay increases. Once again though it shows the need for a better way of doing things.
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Speaking to The Sun, John made it clear exactly what needs to happen, "Now is not the time for a pay rise for MPs. With the tax burden at a 70 year high and only set to rise, hard pressed households and businesses are feeling the squeeze. Politicians pay should be linked to the country’s economic performance to show we're in it together."
The TPA will be ramping up the pressure to ensure that MPs don't get a pay rise in the midst of a cost of living crisis.
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Public sector staff shortages
The rise of the omicron variant has led to a huge impact on the provision of public services. From bin collection to the railways many people are experiencing this first hand. Our media campaign manager Danielle Boxall spoke to talkRadio's Mike Graham about what can be done.
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Danielle pointed out that taxpayers pay a huge amount of money for the public sector and they expect a certain level of service. Whilst there are undoubtedly pressures, covid can't always be used as an excuse. A lack of public services has a huge knock-on effect and every effort must be made to keep the country firing on all cylinders. Click here to watch a clip.
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The cost of servicing the national debt
As the national debt surges ever upwards, analysis by the Daily Mail shows that the interest costs alone will equate to almost £1,000 per person in Britain. The recent spending spree has seen the nation's debt hit £2.3 trillion. Experts at auditors KPMG estimate that the interest payments on this debt will total £64 billion in 2021-22 - an increase of £39 billion on the previous year.
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Weighing in on the findings John called on the government to rein in spending, "Taxpayers will be alarmed that Britain's debts are reaching astronomical heights. These numbers should serve as a massive wake up call for the government. Ministers need to get public spending under control and stop the debt from spiralling further."
If they fail to do so, the national debt will only continue to weigh down taxpayers for generations to come.
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The national insurance hike should be scrapped
National insurance dominated the airwaves again after it was reported that Jacob Rees-Mogg had called for the planned increase to be scrapped. The TPA didn't delay in expressing our approval. Speaking to GBNews presenter Tom Harwood, our policy analyst Darwin Friend expertly outlined why the national insurance rise is such a bad idea.
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He explained that a typical household will see their tax bill rise by £300 this year. Given the worsening cost of living crisis, it's vital that the government gives taxpayers some much-needed respite from the oppressive tax burden.
We'll continue to urge ministers to heed the calls of millions of taxpayers and scrap this unnecessary and damaging tax hike.
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Naughty step: how to cut the cost of childcare
As our operations director Sara Rainwater analyses, the cost of childcare isn't a tax, but it is still something she's been painfully aware of having spent somewhere north of £150,000 on it in almost 11 years. Whilst it was her choice to have children, raise them and cover the costs associated with them, Sara wasn’t quite expecting childcare to cost the equivalent of a small property.
Amongst OECD countries, the UK has the highest childcare costs as a share of household income, coming in at 26 per cent - compared to Germany, where childcare costs account for one per cent of household income. But why is childcare so expensive in the UK, and what can we do to help hard-working parents?
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For starters, the UK has some of the strictest childcare regulations internationally, specifically when it comes to staff-to-child ratios, where there can only be three children under the age of two for each staff member. The government has indicated they plan to relax the ratio rules. Even a small change of allowing one extra child per staff member could reduce fees by between nine and 20 per cent.
The benefits of sorting out the childcare system are immense. The OECD notes that high childcare costs can substantially weaken incentives to engage with the labour market. So ministers should reform childcare regulations. Doing so would improve the economy as it recovers from covid and save families thousands of pounds a year, all the while ensuring taxpayers aren’t fleeced. Click here to read more about how to cut the cost of childcare.
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Council pays the piper
It seems that some local authorities still aren't getting the message when it comes to wasteful spending. According to local press, Doncaster council splashed out £7,000 over the last five years on hold music for council phone lines. Specifically, public money was spent on Luciano Pavarotti's famous Nessum Dorma which rose to prominence at the 1990 FIFA World Cup.
Danielle Boxall didn't hold back and gave the council both barrels, telling reporters, "Taxpayers will be appalled that councils are wasting their hard-earned money on hold music when there are plenty of free options available. Residents expect their cash to be spent on essential frontline services, not squandered on expensive songs.
Local authorities should be ensuring calls get answered rather than wondering how to entertain the ratepayers they leave hanging on the telephone!
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Harry Fone
Grassroots Campaign Manager
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