The top rate of income tax in the UK is 50% on income above GBP150,000. That rate, introduced by the outgoing Labour government in a snub to the professional service and financial industries, is producing so little for government coffers that George Osborne says it's pointless and, worse, provides a disincentive for high-earners to come to or remain in the UK.

He's right to consider how much tax people are paying.

Let's take a look at that top slice of income:

Income tax: 50%

National Insurance: 12% on the first GBP42484 of "taxable benefits" (more than just income is included) and 2% on all income above GBP4248. So, as we are looking at the higher income tax band, for this calculation, we will apply only the 2% National Insurance calculation.

Total so far: 52%.

Almost everything one buys is subject to value added tax, a consumption tax, of 20%.

Total tax so far, 72%

Alcohol, tobacco and petrol are subject to duty in addition to VAT. In fact, VAT is charged on the price of those things after duty has been added, resulting in tax upon tax. Duty varies by product e.g. wine and beer attract lower duty than spirits. Although the penal rates of duty on petrol added as regularly as his jaw dropped by Gordon Brown during his reign of fiscal terror (he introduced an "escalator" tax under which duty increased in line with inflation and then by an additional 1p per litre) were reduced by 1p per litre in this year's Budget, if petrol costs GBP1.3346 per litre, duty and tax accounts for 81.21p of that, according to the UK's The Guardian newspaper. Because we are looking here at duty alone (VAT having been included above), at that price, the duty is slightly higher than 44%. This is after Osborne reversed the Labour administration's decision to add 5p duty and went further and cut the duty by 1p per litre.

So, for every gallon of petrol a higher-rate taxpayer puts in his car, the total tax payable is 72% plus 44% = 116% of earnings.

Even this is not the full picture because a series of windfall taxes and, under Osborne, a special tax have been applied to oil producers. Therefore the base price of oil is inflated by that tax which is hidden within "producer's costs." We may never know exactly how much of that is passed on and how much falls upon shareholders (who, therefore, become payers of a hidden tax on their profits).

If our top rate tax payer invests in the stock market, then he pays 2% on every purchase for "stamp duty," an ad valorum tax. He also pays VAT on any transaction fees imposed by his service provider.

And if he buys or runs a car, there are special taxes: if his car was first registered before 1 March 2001 and has an engine capacity of more than 1549cc, then there is a flat-rate tax of GBP215 per annum. If the car is newer, then the tax depends on its carbon emissions. A decent sized mid-range, mid performance four door family car will cost around GBP300 in "vehicle excise tax," commonly called Road Tax. But there is a sting: when a car is first registered, an additional tax (called "showroom tax") which might, depending on the car, be as much as GBP1000 is charged in the first year.On our example car above, it would be GBP550.

Worse "vehicle tax" is a confusing name because, on the purchase of a new car, there is VAT and a special duty. At the time of writing, we are enquiring of industry sources as to the details of these. But for now, we can say that it's high: the UK has, for several decades, applied higher taxes to new cars than several of its EU relatives.

There has, under UK tax law, been one asset that is sacrosanct, at least during life: the home in which a person lives.While capital gains tax applies to any profit made on a second home, the first home is exempt CGT.

But as Osborne tries to reduce the tax bill, including indirect taxes and his coalition partners - including the anti-bank and generally anti-business Vince Cable want to find a new way of adding taxes. And Cable wants to target the gains made by those who live in a house they own. He wants to introduce it on homes sold for more than GBP1million. The current CGT rate is 20% and Cable has not suggested a lower rate for the sale of first homes. Homes of that value are common in and around London and some other major cities and the measure will not hit only the well-off: many pensioners are house-rich, cash poor due to purchases decades ago in areas that have become built up and expensive.

But add that 28% (either on a first or second home) to the total tax bill shewn above and our top rate taxpayer could find himself with a total tax bill of some 144%.

Worse, these are only national taxes: local authorities raise taxes based on property values. These used to be called "rates" but are now called "council tax" and properties are set into "bands." Second homes get a 10% discount (the discount was 50% until Gordon Brown noticed it in 2004). Property values are assessed by a national department and local authorities determine what tax will apply to properties assessed as being in each band. For the London Borough of Tower Hamlets - which includes Docklands where many City workers live, a property assessed as having a value of between GBP160,000 and GBP320,000 attracts a tax (for the current year) of GBP1992.24. This is a flat-rate tax and therefore operates regressively relative to income. In percentage of income terms, our top rate tax payer will add about 1% to his overall tax bill: for someone earning rather less, the percentage will rise.

These are not "super-rich" people, as many try to suggest. They are those in the middle and upper management of ordinary companies and those who have been prudent in their asset management.

Osborne is on the right track, but he has a long way to go in reforming the total tax take before the UK can consider itself competitive on tax.

Much of the UK media is suffering from goldfish syndrome and treating the current debate as something new but in fact Osborne made plain in his budget speech in March that he intended to remove the 50% tax band as soon as practicable, that it was to be regarded as temporary and hoping that it would be removed in 2012.

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