ONS: Poorest households spending more on VATable items than in 1986

The poorest fifth of households in the UK spent a higher proportion of their expenditure on goods and services that attracted Value Added Tax (VAT) in 2009/10 than in 1986.

The data shows the poorest fifth of households in the UK pay more in VAT as a percentage of their disposable income than the richest fifth.

Research from the ONS reveals that while the fifth richest members of our society spend 5.3% on VAT items the poorest fifth spent close to double at 9.8%.

VAT as a proportion of disposable income

Looking at VAT overall, the poorest fifth of households in the UK pay more in VAT as a percentage of their disposable income than the richest fifth. The difference between poor and rich households, in the percentage paid in VAT, increased in the period 1986 to 2001/02, whereas after 2001/02  the gap was relatively stable.