By Kevin Peachey and Anthony Reuben
Business reporters, BBC News
Death and taxes are said to be the only certainties in life.
But you could add a third entry to the list - that politicians will be constantly debating which taxes to levy and at what level.
So what is the basis for the debate on income tax, National Insurance and VAT, and how do any proposed changes affect you?
The tax system can be difficult to understand but at its heart there are some basic issues regarding how governments raise money to spend on public services and how they affect the money in your pocket.
Because these three taxes bring in most of the government's revenue, if they are trying to raise extra money they will consider increasing one of them.
Some of your income is taxable - and that is not just your wages but also what you might take in rent or your interest from savings.
All wages and working income
Benefits in kind from an employer
Income from property and rent
Interest on savings and investments
Profits from a partnership
For those in full-time employment, the tax is deducted from your wages and outlined on your pay slip.
There are different tax bands. So, for taxable earnings of up to £37,400 a year there is a basic income tax rate of 20%. This rises to the higher rate of 40% for taxable earnings of £37,401 to £150,000. There is a top rate of 50% for taxable earnings of over £150,000.
The phrase "taxable earnings" is key, because the first swathe of earnings is tax-free, and known as the personal allowance. The current basic personal allowance is the first £6,475 of earnings.
If you are self-employed, you must pay income tax on your earnings. Anyone who is retired and collects a pension income has to pay income tax on this money.
Changes to income tax - such as the recent addition of the top rate - may be directed at specific bands. Governments might also change the personal allowance, which generally affects those among the lower pay grades.
We asked accountants Deloitte to calculate the difference to an average earner of an increase of 1p on the basic rate of income tax.
For the 2010-11 tax year, someone earning £25,000 a year will pay income tax at 20% on earnings from £6,475 to £25,000 - a total of £3,705 in income tax. A 1p rise in the basic rate of income tax rate would see this rise to £3,890, a rise of £185 in their tax bill.
National Insurance also gets taken out of your wages if you are an employee and aged between 16 and the state retirement age.
Some people would have seen a recent change in their pay packet
These contributions are used to pay for state pensions and other state benefits such as jobseekers' allowance and statutory sick pay.
Whereas income tax is a levy on all of your taxable income, National Insurance is a levy on your earned income - i.e. wages, as opposed to income from savings.
There are four different National Insurance "classes", but the most significant are the first two.
Class one is for employees. They pay 11% on their earnings between £110 a week and £844 a week, and then 1% on any earnings above £844 a week.
A secondary contribution is then paid by their employer, so any rise will affect a business or public service's coffers as well as their employees.
Our £25,000 a year earner currently pays National Insurance at 11% on earnings from £5,715 to £25,000 - so that would be £2,121 a year. Raising the National Insurance rate by one percentage point would see this increase to £2,314, up by £193, according to Deloitte's calculations.
The self-employed pay Class two National Insurance contributions at a flat rate weekly amount of £2.40.
Class three is paid by those who want to top-up their contributions. This might be because they have fallen short of the amount needed to get benefits - such as the full state pension - because they have not been working.
Class four is compulsory for the self-employed, payable on their annual profits.
There is a full list of contribution levels on the
HM Revenue and Customs website
VALUE ADDED TAX
Value added tax - or VAT - is different from income tax and National Insurance because it is a tax on the goods and services you buy.
This is usually included in the price so retailers have to include it in their display price.
There are three different rates - the standard rate, the reduced rate and the zero rate.
The standard rate of 17.5% is paid on most items, such as clothes and electrical goods.
The reduced rate of 5% is levied on some more essential purchases such as domestic fuel and children's car seats.
And items that you do not pay VAT on include food, books, newspapers and magazines, as well as young children's clothing and footwear.
The zero-rated VAT goods are generally essentials rather than luxuries, so the lowest paid will pay less on VAT than the highest earners who would generally spend more.