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+--- Thread: Article Brits face biggest tax burden since WWII: record drop in household income expected (/thread-13823.html)
Brits face biggest tax burden since WWII: record drop in household income expected - C C - Mar 16, 2023
https://www.lbc.co.uk/news/brits-face-biggest-tax-burden-since-world-war-two-budget/
INTRO: British people are set to bear the biggest tax burden since the Second World War, with household incomes expected to plummet by record levels after the Budget announcement on Wednesday.
The Office for Budget Responsibility (OBR) said that six million people would be hit by ‘stealth taxes’, like freezes for tax thresholds, over the next five years, boosting government coffers by £120 billion. The independent economic analysts said this would be the equivalent of a 4p increase in the base rate of tax.
The UK’s tax burden is on track to hit 37.7 per cent of GDP, the OBR added. Freezing income tax thresholds mean 3.2 million people will start paying in the next five years, 2.1 million will move up to the higher 40p rate, and 350,000 more will pay the 45p rate.
Meanwhile corporation tax will rise to 25% from 19%, although businesses will be able to write off investments in the UK against taxable profits under a new £9 billion-a-year scheme.
The OBR expects a record drop in household incomes of nearly 6% over a two-year period, driven by the tax hikes and inflation, which is still rising ahead of earnings, although it is set to come down markedly this year.
Other key announcements in the Budget on Wednesday included 30 hours of free childcare per week for all children older than nine months, the increase of pensions annual tax-free allowance from £40,000 to £60,000, and the abolition of the pension lifetime allowance, previously set at £1.07m... (MORE - details)