In Britain inflation has been accompanied by inadequate adjustments in tax allowances and bands so that real rates of taxation have increased sharply. This inadequate adjustment is inequitable as between taxpayers, and tends to bear more harshly on low-income and large families than on higher-income and smaller families.

Incomplete adjustment transfers more revenue to government that taxpayers know or wish to pay. Between 1973-74 and 1975-76, for example, personal taxes more than doubled.

Inflation is taxation by misrepresentation. Large increases in tax revenue induced by inflation exonerate politicians from asking the electorate explicitly for higher tax rates.

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