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‘Tax freedom day’ delayed

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Taxpayers in the UK are working two days longer on average in 2015 than in 2014 before they stop paying taxes and start earning for themselves, according to ACCA. ‘Tax freedom day’, calculated annually by the Adam Smith Institute, falls on 31 May.

Chas Roy-Chowdhury, ACCA head of taxation, said: ‘The rises in the personal allowance have created a huge amount of fiscal drag. More and more people are being caught in the 40% tax bracket. At the end of the 1980s only 500,000 people were paying the higher rate of tax, now that is more than four million people. So despite all the government hype on increasing the personal allowance, we are actually two full days worse off this year before our income is ours to keep.’