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More middle-income earners dragged into higher tax band as average pay rises 7pc
The number of jobs paying a higher rate salary has doubled in three years amid a stealth tax raid on incomes, figures reveal.
Lecturers and paramedics have been dragged into the 40pc band that has historically been applied to wealthier professionals.
The freeze on tax thresholds, which Rachel Reeves is set to extend in her Budget, means middle-income earners are falling into Britain’s second-highest tax bracket.
One in ten occupations across England and Wales now has a median salary of more than £50,270, compared with just one in 20 three years ago.
Workers are taxed at 40p for every £1 they earn above that threshold, a burden now faced by scientists, civil engineers, pharmacists, paramedics, lecturers and human resources managers.
Tax thresholds have been frozen since 2021, including tax-free personal allowances, currently £12,570, and the higher rate tax bracket which currently starts at £50,270.
The previous Conservative government set a 2028 date for the thresholds to uplift with inflation again, something not seen since Rishi Sunak was chancellor in 2021.
At that time less than 4pc of occupations had median salaries worth more than the higher rate tax threshold. The Chancellor is considering extending the freeze by two years until 2030.
Average full-time employee earnings increased by 7pc, hitting £37,430 this year, according to figures, from the Office for National Statistics’s annual survey of pay.
Postal workers saw the largest increase in pay among major occupations, with a 18pc increase, taking their pay to £33,583. This was followed by special needs teachers, general doctors and waiting staff.
The increase in doctors’ pay likely reflects pay deals agreed by junior doctors and consultants, which boosted their pay to £48,288.
The pay of specialist doctors increased by 7.7pc, hitting £74,979, with the top tenth percentile of doctors earning just short of £150,000 a year.
Meanwhile, another bumper increase in the minimum wage in April to £11.44-an-hour likely helped drive up lower paid workers’ annual pay.
Chief executives remain the highest paid occupation at £88,056 a year, followed by marketing directors, IT directors and financial managers.
Newspaper editors, insurance underwriters, lawyers and train drivers were among the occupations to see average, full-time pay fall year on year.
However, train drivers remain the 12th best-paid occupation, earning £63,958-a-year, with the top quarter earning around £70,000. This puts them ahead of barristers, electrical engineers and IT managers.
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