Summary
Households in the UK are expected to see only a small increase in their disposable income over the next five years due to government tax and spending plans. The Institute for Fiscal Studies notes that this growth is much lower than in past decades, and the government faces criticism for not keeping its promise not to raise taxes on working people.
Key Facts
- The Institute for Fiscal Studies (IFS) says household disposable income will grow by about 0.5% annually.
- Disposable income is the money people have left after paying taxes.
- This growth is lower than the over 2% annual increases seen between the mid-1980s and mid-2000s.
- The government has increased taxes, spending, and borrowing, raising concerns.
- An accusation is that the government broke its promise not to raise taxes on working people.
- Chancellor Rachel Reeves stated that changes such as higher taxes on online gambling and high-value properties are necessary.
- Other measures include freezing NHS prescription charges and scrapping some levies on energy bills.
- Reeves emphasized that tax contributions are minimized to address issues like NHS wait times and child poverty.
