Marginal Tax Rates
The question
To ask the Chancellor of the Exchequer, what the highest possible marginal tax rate is.
Answered by James Murray
For individuals with income between £100,000-£125,140, the income tax Personal Allowance is tapered by £1 for every £2 earned above this limit, until it has been completely withdrawn at £125,140. Taxpayers with incomes within the taper band face a higher effective marginal tax rate of 60%, compared to 40% below £100,000 and 45% above £125, 140. Income tax rates and thresholds are devolved in Scotland, so marginal rates within the taper band will vary based on the registered address of the taxpayer.
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