Ask the group to work out how much tax they have paid in the last month! If they say they do not pay tax remind them that they pay VAT at 17.5% on many items. Note that food is zero-rated as are books, magazines, bus and rail fares. All other items have VAT added to them.

Taxation is often used to discourage activities that the government considers harmful. For instance there is very high tax on wines, spirits and cigarettes to reduce the amount of each that are bought. Does the class think this is a good thing to do? What are the advantages and disadvantages of doing this? Do the people who use these items cost society more in the long run? (e.g. The Health Service).

Of the 80p paid for every litre of petrol in the UK about 5p covers the cost of the fuel to produce and transport it. About 50 pence is taken by the government in tax (and about 25p in profit). Is this a fair way of raising taxes? What would happen if the level of tax were to be reduced dramatically, (e.g. pollution, congestion etc.) and would drivers necessarily be better off?