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Tax rises - details of Boris Bombshell revealed

January 8, 2022 3:12 PM
By Lib Dems

The Conservative government's tax increase will cost the average family in England and Wales £430 a year by 2026, research commissioned by the Liberal Democrats has revealed.

The figures reveal the scale of the cost to families of the government's decision to freeze the personal tax allowance and higher rate tax threshold until 2025/26, compounding the growing cost of living crisis.

The analysis by the House of Commons Library has found the freeze will mean an additional 1.5 million people on low pay will be dragged into paying income tax by 2026, while a further 1.25 million people will fall into the higher rate tax bracket. The research is based on modelling using the latest inflation forecasts from the Office of Budgetary Responsibility.

The Liberal Democrats are demanding that the government drops their planned stealth tax raid that will "clobber families who are already feeling the pinch," amid soaring energy bills and the rising cost of living.

Regional figures show that London and the South East are set to be hardest hit by the stealth tax, with an average hit to incomes of £500 per household.
Across all regions, household disposable incomes are expected to be 1% lower (£430 per household) in 2025/26 than they would be if there were no freeze to income tax thresholds.

Liberal Democrat Treasury Spokesperson Christine Jardine MP said:

"Boris Johnson must drop this unfair stealth tax that will clobber families who are already feeling the pinch.

"People are worried about the rising cost of living and paying their bills this winter. Now they face years of tax rises under a Conservative government that is taking them for granted."


This story was first reported in the Telegraph here.

The Commons Library full analysis including a breakdown by region is available here.