IFS: One in five workers will be higher-rate taxpayers by 2027 Analysis by the Institute for Fiscal Studies (IFS) suggests that almost 8m people – one in five of all taxpayers – will be higher-rate taxpayers by 2027 as a result of the Government’s freeze on income tax allowances and thresholds. The think-tank said an additional 2.5m people will no longer be basic rate taxpayers by the time the six-year freeze on allowances and thresholds comes to an end in 2027/28. The study shows that in 1991/92, 3.5% of UK adults (1.6m) paid the 40% higher rate of income tax. By 2022/23 that had risen to 11% (6.1m) and it is set to reach 14% (7.8m) by 2027/28. The IFS predicts that more than one in eight nurses, one in six machinists and fitters, one in five electricians and one in four teachers are set to be higher-rate taxpayers by 2027. Isaac Delestre, a research economist at the IFS, said: “For income tax, the story of the last 30 years has been one of higher-rate tax going from being something reserved for only the very richest, to something that a much larger proportion of adults can expect to encounter.” He added that freezing thresholds leaves the income tax system "hostage to the vagaries of inflation." Mark Littlewood, director general of the Institute of Economic Affairs, commented: “The higher rate of tax was initially envisioned to capture an enhanced revenue stream from super-high earners. Managing, at some point, to get your salary to above £50,000 surely can't be said to be in that category.”