UK households face seeing a huge £3,500 wiped from their bank accounts as early as 2024. That is according to a warning from one of the country’s leading economics thinktanks.
The Institute for Fiscal Studies (IFS) has said that the country is on course for the biggest percentage tax increase over the course of a parliament in more than 70 years, reports the LiverpoolEcho. Tax revenues could rise to 37 per cent- the biggest increase over a parliament on records dating back more than seven decades.
The IFS says that on current forecasts the Conservatives are on track to raise £100bn more annually by next year, which is the equivalent to around £3,500 more per household. Ben Zaranko, a senior research economist at IFS, said: “This is not, for the most part, a direct consequence of the pandemic. Rather, it reflects decisions to increase government spending, in part driven by demographic change, pressures on the health service and some unwinding of austerity.
“It is likely that this parliament will mark a decisive and permanent shift to a higher-tax economy.” Sarah Olney, the Liberal Democrat Treasury spokesperson, said in response to the IFS’ findings on Friday: “This is the same party which promised not to raise people’s taxes and is now taxing families through the nose.”
A spokesperson for the Treasury said that “despite needing to take the difficult decisions to restore public finances” and went on: “Driving down inflation is the most effective tax cut we can deliver right now, which is why we are sticking to our plan to halve it, rather than making it worse by borrowing money to fund tax cuts.”
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