Richest households benefit 12 times more than poorest from national insurance cuts, thinktank says – UK Politics Live

Good morning. On Wednesday, Chancellor Jeremy Hunt will deliver his final budget before the election. As always, the expectations management process is underway, affecting many (but not all) pre-budget reports, but the political backdrop makes it more complicated than usual. The standard approach is to play down expectations ahead of time, so that when an unexpected tax cut or spending announcement comes in the last five minutes of a speech, both members of Congress and the media are surprised and impressed, and coverage unfolds in a cloud. Positivity. But with the Conservatives still trailing by around 20 points in the polls (the latest figures can be found in the Guardian’s poll tracker), No 10 and the Treasury have been talking up the prospect of tax cuts for months as It’s the only way to delay tax cuts Income tax, already pocketed, and a 2p cut could be a possibility.

this morning new economics foundation Published research said if Hunt did cut National Insurance in this way, the cash benefits to the richest households would be 12 times greater than the poorest households. This is not a surprising or controversial assessment; Hunt said the same thing when he cut National Insurance by 2p in his autumn statement. But this has not received much attention in the debates in recent days, partly because Labor does not want to be seen as opposing tax cuts that could benefit ordinary workers.

The following is an excerpt from NEF’s press release.

If the Chancellor announces a 1p cut to National Insurance in this week’s Budget, the richest 20% of households will benefit 12 times more than the poorest 20%, with the top earners receiving an extra £424 a year, compared with That’s £34. A year for those at the bottom.

This means £2bn of the £4.8bn tax cut package will go to the richest people, while the poorest will benefit from just £160m.

Meanwhile, households in London and the South East will be the biggest winners, with an average increase of £252 a year, while those in the north will see an increase of £175 a year.

This comes from NEF Senior Economist Sam Tims.

Everywhere you look, from our schools to our hospitals to our high streets, our country is falling apart while millions of people struggle to get by. But at the same time, our Prime Minister is pushing for tax cuts that the country does not want, which will benefit those who already benefit the most.

Not only will this reduce government revenue in the near future, it will increase inequality, make us all poorer, and damage the country’s prospects.

as Richard Partington and Alesha Adu New YouGov polling supports claims that tax cuts are not a priority for many people, reports suggest.

This is the agenda for the day.

10.30am: Shadow Work and Pensions Secretary Liz Kendall speaks

11.30am: Downing Street holds lobby briefing.

2.30pm: George Galloway, the new MP for Rochdale, takes up his seat in the House of Commons.

2.30pm: Upgrade Secretary Michael Gove takes questions in the House of Commons.

After 3.20pm: Peers begin the reporting phase of the Rwanda Security (Asylum and Immigration) Bill.

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