Tez.
Nice idea, however HMG can levy tax in more than one way.
Yes, there is the percentage method, but there is also the "per item" method.
I'm sure this has all been checked very thoroughly for legality.
As for whether the public are being ripped off, that depends on your outlook. If you accept that people want more money spent on public services (healt, education etc.) then that money has to come from somewhere. The only place it CAN come from (sustainably anyway) is to tax the populace.
You might well suggest that we don't get very good VALUE for our money, but that's a whole other thread!