Britain’s lawyers and accountants have coughed up £15.5bn in taxes last year, giving everyone something to celebrate, writes Emelia Hamilton-Russell
You might not love your accountant’s or lawyer’s fee, but the chancellor of the exchequer does – and so does the hungry British taxpayer. According to a report published this morning by TheCityUK, a lobby group for the financial services industry, the country’s legal and accounting firms generate an estimated £15.5 billion, including £5 billion in employment taxes, in the 2015/16 tax year.
That amounts to fully 2.5 per cent of all UK tax receipts – enough to pay for to three new Queen Elizabeth-sized aircraft carriers fully loaded with 24 fighter jets apiece, or half of the Scottish Government’s yearly spending budget. Alternatively, it’s enough to pay for all the police in Britain – or equip our traffic police with 300,000 Jaguar F-Type sports cars.
‘The legal and accounting sector make a considerable contribution to the UK economy in their own right, and are an essential part of the world-leading financial and professional services ecosystem,’ notes Miles Celic, chief executive of TheCityUK.
And this expertise isn’t just located in London – right across the UK, it employs nearly 700,000 people with centres of excellence beyond the capital including Manchester, Bristol and Edinburgh. ‘These are also the areas we expect to see the most growth in the coming years as we move through Brexit and beyond,’ adds Celic.
Interestingly, the report finds that the UK has the highest proportion of professional services jobs in the EU, with 23 per cent of its accounting and legal jobs in Britain, ahead of Germany at 12 per cent, France on 8 per cent and Spain on 2 per cent.
Combined with the significant total tax contribution for the financial services sector (standing at £71.4 billion), the estimated total tax contribution for UK-based financial, legal and accountancy services is £87 billion.
So spare a thought for the chancellor’s blue book – and the health of his sums as he attempts to reduce the UK deficit. These figures show that the lawyer or accountant in your life is clearly pulling his weight. Which is just as well…
Emelia Hamilton-Russell is a researcher at Spear's