For every £1 of tax cuts for households, £2 will be taken away. Liz Truss and Kwasi Kwarteng have performed a dramatic U-turn on their plans to abolish the top rate of income tax. The majority of tax cuts announced remain, including scrapping a planned increase in corporation tax.
On the surface, the Tories’ tax cuts do include cuts for workers too. But all is not as it seems. If you do get even a small pay rise, you could find yourself in a different tax bracket, and taking home less anyway.
The tax thresholds have been frozen for four years. By 2025-26, basic rate tax payers will be paying an extra £500 a year and will have grown by 1.4 million in number, according to the Institute for Fiscal Studies.
The threshold freeze has been labelled a “stealth tax”. But there is nothing stealth about the Tories’ intention to make the working class pay. Time to get organised and fight back!
