IS THIS A LEVEL UP? Lack of support for the poorest has pushed 1.3 million people into poverty

CHANCELLER Rishi Sunak has come under fire for failing to help Britain’s 1.3 million poorest workers in his spring statement by pushing them into poverty.

During yesterday’s spring announcement, the chancellor was praised for helping motorists cut fuel costs by 5p, but his spring announcement left more than a million Britons on the brink of “absolute poverty,” a leading think tank said.

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The Resolution Foundation, a living standards think tank, has warned that Rishi Sunak’s measures are a “large but poorly targeted policy package” that does not do enough to help families who have been hardest hit by the cost of living crisis.

In a statement to the Commons, Sunak raised the threshold at which people pay national insurance contributions, benefiting an estimated 30 million workers with over £330 in tax cuts.

He pledged further support in 2024, promising to cut the base income tax rate from 20p a pound to 19p – “a £5bn tax cut for more than 30m people”.

However, an analysis by the Resolution Foundation found that Mr Sunak’s measures fall short of the scale of the reduction in the cost of living: 1.3 million Britons will fall below the poverty line next year, including 500,000 children. rise outside the recession.

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It was also found that only one in eight workers would see their tax bills cut by the end of Parliament.

The Resolution Foundation told Politite magazine: “Given all the changes in income tax thresholds and rates announced by Rishi Sunak, only those earning between £49,100 and £50,300 will actually pay less income tax in 2024-25, and only those earning between £11,000 and £13,500. will pay less taxes and national insurance.

“Of the 31 million people employed, about 27 million (seven out of eight employed) will pay more income tax and (public insurance) in 2024-2025.”

The think tank added that typical working-age household incomes will fall by 4% in real terms next year, while incomes of the poorest quarter of households are expected to fall by 6%.

Resolution Fund Executive Director Thorsten Bell said: “The decision not to send support to those hardest hit by rising prices will hit low- and middle-income households hard: 1.3 million people, including half a million children, will fall below the threshold. . poverty line next year.

“And despite the attractive 1p income tax cut, the reality is that the chancellor’s tax changes mean seven out of eight workers will see their tax bills rise. These tax hikes mean the chancellor can point to rapid fiscal consolidation and a substantial headroom in his fiscal rules.

“The overall picture is that Rishi Sunak has prioritized restoring his tax-cutting powers over supporting low- and middle-income households, which will be hit hardest by the rise in the cost of living, while leaving himself fiscal flexibility in the coming years.

“Whether this will be sustainable in the face of a huge drop in revenue remains to be seen.”

More to come.

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