Wales, N.Ireland Lagging in Tax Collections

October 4, 2013 Taxation In EuropeTaxation in UK

English Pound coinsLONDON – Wales and Northern Ireland collect a disproportionately small portion of taxes in the UK, and calls are being raised to let the countries set their own tax rates.

In a report released on October 2nd the HM Revenue and Customs outlined the differences in the amount of taxes collected from England, Wales, and Northern Ireland, showing that the relative economic performance of Wales is lagging behind the rest of the UK.

The report shows that taxpayers in Wales and Northern Ireland pay an average of 25 percent less tax on earnings and profits than taxpayers in the rest of the UK.

Overall, Wales contributed approximately 3.5 of all tax collections in the UK, while having nearly 5 percent of the population.

Similarly, despite having approximately 3 percent of the population, Northern Ireland only brought in 2.6 percent of the UK’s total tax collections.

The Institute of Fiscal Studies has already commented on the results in the newly published report, saying that this is the first detailed breakdown of the differences in tax collections within the UK, and “…what is particularly striking about these estimates is how much lower taxes per person in these areas are than in England or Scotland.”

Commenting further on the results, the head of external affairs at the Institute Iestyn Davies said that this is new evidence to support the claim that Wales and Northern Ireland should be granted a greater degree of tax autonomy to set and collect their own income taxes separately from England.

Photo by Images_of_Money