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July 08, 2005



Put otherwise, it should be pretty easy to cut both taxes and benefits in a way that does not increase inequality, but that does realise the benfits that should flow from such cuts.


Twit! Please read as "but that does realise the advantages that should flow from such cuts."

Phil Hunt

"The bottom quintile spends 31 per cent of its income on indirect taxes, whilst the top quintile spends only 19 per cent."

Is this due to the taxes on booze and fags?


It's only partly due to booze and fags, Phil. The poorest quintile spend 5.3% of thie disposable income on these, against 2.4% for the top quintile. There are also big differences in VAT (11.8% of poor incomes against 8% of high incomes) and "other" duties (mostly insurance and gambling I guess), which are 10.7% and 6.2% of incomes.

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