Tag Archives: fantasy economics

• Nearly 2 million to be hit by £9 billion “stealth tax bombshell” by the end of the decade
• Labour needs to “learn to u-turn faster” on two-child benefit cap
• Davey on Farage speech: “Trussonomics on steroids”
• Triple lock: from privatising the NHS now Farage “wants to come after people’s pensions”
• Badenoch must rule out Rupert Lowe joining Conservatives
• 9,523 Scots waiting on social care assessment or care package

Nearly 2 million to be hit by £9 billion “stealth tax bombshell” by the end of the decade

The Labour government’s plans to maintain the income tax threshold freezes introduced by the Conservatives mean that an estimated additional 1.9 million people will be hit, forcing them to shell out close to an estimated £9 billion in additional tax receipts by the end of the decade, House of Commons Library research, commissioned by the Liberal Democrats, has revealed.

The Labour government has said that income tax threshold freezes for both the Personal Allowance and the higher rate of income tax will be maintained until April 2028. The impact means that between 2025/26 and 2029/30 an estimated 1.9 million people will be forced to pay a higher rate of tax due to these threshold freezes.

It means for those millions impacted, they will be forced to shell out an estimated £8.9 billion in additional tax as a result of the freezes by the end of the decade.

It follows on from the previous Conservatives government’s decision to freeze tax thresholds in April 2021. The House of Commons Library research says the impact of that 2021 freeze combined with the Labour government’s decision to maintain the freeze means that an estimated additional 7.625 million people will have been dragged into higher tax bands by the end of the decade. That is the equivalent to one in nine of the current UK population.

The total additional tax bill since the 2021 freeze will reach roughly £33.2 billion by 2029/30, rising from £24.3 billion this year.

The hardest hit areas will be London and the South East, where people in both regions hit by the stealth tax will pay out an estimated £3 billion in additional tax from now until the end of the decade. In total, London and the South East will have paid out £11.3 billion in additional taxes by the end of the decade since the April 2021 freeze.

The Liberal Democrats said that the “Conservative economic vandalism led us into this mess, but this Labour government has proven clueless in generating the growth needed to break this stagnation”. The party added that the only way to bring down the tax bill was through meaningful growth and that needed to come from the Government scrapping its jobs tax and negotiating a bespoke UK-EU customs union.

Liberal Democrat Treasury spokesperson, Daisy Cooper MP said:

During the midst of the worst cost of living crisis for a generation, people are now set to be hammered once again by this stealth tax bombshell.

People should be rewarded for their hard-work, not seeing earnings ripped away through these punitive measures.

The Conservatives’ economic vandalism led us into this mess, but this Labour government has proven clueless in generating the growth needed to break this stagnation.

The only way we can bring the tax bill down, protect family finances and rebuild public services is through meaningful economic growth. That has to come from scrapping the Government’s jobs tax and negotiating a bespoke UK-EU customs union to free our businesses from a Gordian Knot of red tape.

Labour needs to “learn to u-turn faster” on two-child benefit cap

Responding to Bridget Phillipson telling the Today programme that scrapping the two-child benefit cap is “on the table”, Daisy Cooper MP, Liberal Democrat Treasury Spokesperson and Deputy Leader, said:

The heartless two-child limit has to go – no ifs, no buts.

Dangling hope in front of desperate parents is inexcusable. Continuing to punish children just for being born is unforgivable.

The public is fed up of a government failing to deliver change – Labour needs to learn to u-turn faster.