I can give you a non-exhaustive list of why things are so expensive in the UK:

Import duties calculated as a percentage of cost of goods + freight.
High transportation costs as a result of exorbitant duties levied on diesel.
Exorbitant business rates charged on commercial premises by local authorities.
Exorbitant Employer's National Insurance calculated on the basis of each of your employee's salary.
Exorbitant Class 1A National Insurance on any 'perks' you provide for your employees.
Exorbitant rate of VAT charged on sales value.
Exorbitant Corporation Tax payable on company profits.

At the end of the day it all boils down to the huge state. Somebody has to pay for the thousands upon thousands of public sector boondogglers with their flexi-time and fancy pension schemes.

Research done in the UK showed public sector workers were paid 30% more than somebody doing a similar job in the private sector, they worked 9 years less and then headed off into retirement with a pension a private sector worker could only dream of.

On top of the plethora of exorbitant taxes required to maintain the lavish lifestyles of the bloated public sector the European private sector has other handicaps imposed that reduce efficiency such as:

Absurd employment law - employing someone seems almost akin to adopting them, it's hard to get rid of them even if they turn out to be a worthless, lazy bludger.

EU beaurocracy - EC Sales Lists, Intrastat, Triangulation, etc... (it's actually easier for me to deal with the Far East or the USA than it is other EU member states).