Categorized | matt's blog

Back to the future – predictions for new taxes by the year 2033

There is one absolute surety about the future of taxation in the UK and the developed world – it will only ever go up. It is possible that individual tax rates may fluctuate and some may even disappear. But, you can always be 100% certain the total amount of tax, as a percentage of GDP, will always increase. The real trick of government is to find new and exciting ways to make that increase as opaque as possible. For example, you can lower the fuel duty received on petrol as long as you increase the VAT on electricity.

As the world is changing at an alarming rate, this will allow new taxes to be invented and within the next 20 years, I would expect at least some of the following.

Super VAT. This will be a new VAT rate on luxury goods. As we currently have a rate of 20%, it would make sense for there to be a higher rate of 30% on goods and services that are deemed “luxury”. You are probably thinking perfume and Belgian chocolate. I am thinking smartphones and tablet PC’s. Whatever collects the most in tax will be redefined as a luxury good.

Twitter Tax. Anyone with more than 50,000 followers will have to pay a flat fee of £100 per letter for every vacuous and futile posting they make. There would be an exemption for replying to a comment.

Internet Tax. Why this hasn’t already happened is a mystery to me. The easiest way to raise money is to tax people on a product or service they can’t do without. This was the reason for adding VAT onto energy at the rate of 5%. On top of the usual 20% VAT, there will also be a further tax, but it will not be called a tax, it will have another name.

Facebook request tax. Anyone sending me a request to play any game whatsoever on Facebook, will be taxed an extra 5% on their annual income.

Land surcharge. Not only will you have to pay council tax, there will also be a land surcharge fee based on the amount of square feet your property has. Farmers will be exempt and so anyone with more than one acre will start growing onions the next day. If you think I’m making this up – search for window tax on Google.

Bank of Dad tax. Any parent helping their child to get a deposit on a flat or paying for them to go through University, will have to pay a duty to HMRC. We are now moving into a period where it will be impossible for anyone under 25 years old to get their own deposit for a property or even earn enough to get a mortgage. Deposits paid by parents will be taxed as income or added to the value of a property when calculating stamp duty.

Apart from the above taxes, I also predict the method of calculation will change. About 15 years ago we moved to a system of self-assessment and this basically means you tell HMRC how much you have earned this year. With the advent of technology, a new system will appear where they already know what income has gone through your bank account and you will be taxed on that income, less what you can claim separately as an expense.

If you are reading this in 2033, I will now be 62 years old – which means I am probably only 15 years from the state pension age.

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