New figures from the Office for National Statistics (ONS) show that taxes on income are now equivalent to 23.6 per cent of wages and salaries. The figure is the highest since records were first kept in 1987.

The burden on consumers was at its lowest in the fourth quarter of 1997, shortly after Labour’s election victory, the data revealed.

Taxes on incomes rose by 6.7 per cent over the past year, much higher than the 4.6 per cent rise in wages and salaries.

Together with increasing interest rates, strong inflation and high utility bills, the rise in taxes added to the strain on consumers’ finances.

The ONS said that disposable incomes rose by only 1.3 per cent in the year to the third quarter of 2006, once inflation was stripped out. That was the weakest rise in household budgets since the fourth quarter of 2004.

That suggests that the retail revival of recent months has not been quite as heady as believed, as consumers dipped into their savings to finance purchases.

A Treasury spokesman said: “Using the quarterly accounts data, it is not possible to produce an accurate figure for income-tax ratios for households, as they take no account of income from a range of sources, for example savings, shares, and asset disposals.

“The fact is that, as a result of all tax and benefit reforms introduced since 1997, all households will be on average £1,000 a year better off in real terms from April 2007. In addition, the UK’s tax-GDP ratio in every year since 1997 and going forward throughout the forecast period remains below the peaks reached in the mid-1980s.”

According to yesterday’s National Accounts, which update official GDP estimates and contain the most detailed description of the state of economic growth, consumers’ saving fell to 5.1 per cent of their income in the third quarter from 5.4 per cent in the second quarter.

Consumer spending as a whole also grew less than previously thought. It rose by 2.1 per cent, below its long-term average, in the year to the third quarter, compared with an earlier estimate of 2.4 per cent.

The other drivers of domestic demand — government spending and business investment — were also weaker than initially believed, the data showed. However, the overall growth rate in the third quarter was fractionally stronger, because of a higher estimate for inventories — a sign that retailers were hoarding stocks more than first thought.

That was not enough to change the headline figure of 0.7 per cent growth in the third quarter. But the year-on-year figure did rise, to a healthy 2.9 per cent, the fastest pace in two years. It was up from an initial estimate of 2.7 per cent, putting Gordon Brown, the Chancellor, comfortably in line to meet his growth target of 2.75 per cent for 2006.

Geoffrey Dicks, of RBS Financial Markets, said: “Everything has conspired against the consumer. Wages growth has slowed and inflation has picked up. Consumption growth is sluggish and what we’re getting is as much coming out of savings as income.”

Analysts were divided on whether the stronger headline growth rate made another interest rate rise next year more likely.

Separate ONS data on the balance of payments showed a current account deficit of £9.4 billion, equivalent to 2.9 per cent of GDP, after an £8.3 billion gap in the second quarter.

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