Some things are more expensive in the UK and some things are cheaper and it sometimes depends on how you look at it, but they don't call it "rip-off Britain" for nothing.
With most goods, you can expect them to cost around the same in pounds as they do in dollars, ie. if a cd cost $13.99 in US, and costs IRO £13.99 in the UK, but if you consider the exchange rate, you’re actually paying over $20 for a cd here.
This is not always the case, and things are improving as consumers are demanding to pay the same as other countries. One area in which the UK costs are terrible is petrol (gas) prices. They’re currently near £1.10 per litre (Oct 2015). That’s near £5.50 per gallon, with exchange rate near $9.00 per gallon, or in a car that gets 25mpg, £5 will get you almost 25 miles. These prices are largely due to taxes, as an incentive to ride public transportation (which can be more expensive anyway).
Sales tax, known as Value Added Tax (VAT) was 17.5% until 2010 when it was lowered to 15% to boost the economy, but then it was increased to 20% in 2011. Home energy is only taxed at 5%, while most groceries and children's clothes are 0%.
Typical Expenses
- Income Tax (seems around 20% average)
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Council Tax (around £100-150/month for an average family home, depending on property value, area, etc.) There are tax bands (A, B, C, etc) and you can search gov.uk by address, and then find the local council tax rate.1
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TV License (£145/year for colour TV, £49 for black and white)
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National Insurance (taken with income tax from wages)
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VAT (20% sales tax on shopping)
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Vehicle Road Tax/MOT(emissions and safety tests)/Insurance (Annual Road tax : £230 per year at post office or now by monthly direct debit, unless you have a big 4x4 and it's then around twice that2, annual MOT tests IRO £50 at test centres, Insurance (dependent on vehicle and driver but anywhere from £400 to £1500 per year for average cars)
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Housing/Utilities varies widely depending on location and size. If you search Google for "house prices in ..." you will get results that will give you an idea. The lovely old stone homes, are drafty and expensive to keep warm, especially listed buildings with old windows that can't be modernised.
The Savings Offset
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Freehealth care (because you paid National Insurance/taxes) -
Not needing a car if rail/bus services are convenient
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Company car (many employers supply these, if you’re lucky, but you will pay tax on this benefit)
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One less tax to pay, ie. not state AND federal as in the US
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More exotic vacations for less money, Greece, Paris, etc., flights to Europe are cheap.
Prices in general: milk : 1.20p per 2 litres; bread : 65-1.45p per loaf; eggs : £1.69 per 1/2 doz; gas/petrol(sky high for the taxes) Petrol : 1.08p per litre, Diesel : 1.07p per litre (5 litres to a gallon); cigarettes : £5.90 pack of 20, give or take 50p depending on your brand of choice; you’ll find utility prices discussed elsewhere in the site.
One University site states: “In total, for a full year, a single student will need about £7500 - £9500 (2000 figures) to meet the basic expenses of living in London (excluding tuition fees).
The BBC has published an article that estimates a single person needs at least £13,400 annually, with links to the budgets and charts of expenditure breakdowns. http://news.bbc.co.uk/1/hi/business/7481927.stm
Average gross salary in the UK for 2015 is £26,500. (See average earnings by jobs in 2014 at http://www.icalculator.info/news/UK_average_earnings_2014.html.)
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