How much extra tax will I pay under labour?

The answers is probably none.

After the media sent out conflicting scaremongering messages about the pledges in the Labour manifesto, I decided to look into it myself.

The current rates on income tax are 20% for earnings between £11,500 and £45,000, 40% for earnings between £45,000 and £150,000 and 45% for earnings above that.

If you earn £11,500 or less, you will pay no income tax at all. If you earn £11,501, you don't suddenly start paying 20% on all £11,501. You will just pay it on earnings above £11,500, i.e. on £1. So you would just pay 20p tax.

This is something that seems to confuse some people. You pay a percentage on everything you earn that falls within that band.

The proposal in the Labour manifesto is that the banding for the 45% tax rate will begin at £80,000 rather than £150,000 and there will be a new 50% tax rate for any income above £123,000.

I have created a chart below which shows these changes. The max tax for the band and max additional tax are the important numbers. If you earn up to £11,500, you can see that the maximum tax for the band is £0 and this is the same under both the current and proposed tax rates.

If you earn between £80,000 and £123,000, the current maximum tax you could pay (if you earn at the top of the band) is £37,899 per year. Under the new system, this will increase to £40,049, an increase of £2,150.

So for the majority of people, there will be no additional tax. Their proposed changes are intended to only affect 5% of the workforce who earn over £80,000. The current workforce stands at 31.95 million, so 5% works out to be around 1.6 million people. This sounds like a lot and the press have been using this number to attempt to make their readership angry about it.

However, it is important to remember this is only for the top 5% of earners. If we look at a list of salaries by profession, we can see the sorts of people who will be affected by this. The list is from 2015 so is slightly out of date. We can see that those professions where the average salary is over £80,000 include Chief Executives and Senior Professionals, brokers, aircraft pilots and flight engineers, marketing directors and sales directors.

You are not talking about your average Joe.

As well as the newspapers using the tax rises to turn the public against the Labour party, the Conservatives have plain lied about what the tax rises are. The tweet below was sent earlier this week. Whilst we have seen that just over a million people will be affected, the tweet uses the word "millions" which suggests that many more people will be affected than actually would be.

It also says that they will be increasing the basic rate of income tax to 25p. 25p in every pound would be an effective tax rate of 25% and as we've seen, this is not any part of the proposal and is an outright lie.

It is this sort of electioneering (along with the £350 million for the NHS bus pledge) which make the public disillusioned with politics and politicians.