“Across the forecast, if you take into account the different tax changes, the tax burden continues to rise, and the average family will be £870 worse off at the end of the forecast period”The shadow chancellor was responding to Wednesday’s budget, in which Jeremy Hunt cut National Insurance Contributions from 10 per cent to 8 per cent.The £870 figure is based on Labour’s own calculation, using figures from the government spending watchdog, the Office for Budget Responsibility .
Labour has added to that the government’s policy to allow councils to raise council tax more easily, which the OBR says will put an extra £4.9bn in the public coffers by 2028-29. The independent Institute for Fiscal Studies think tank told FactCheck that the number “isn’t unreasonable” but “isn’t the whole story either”.
And the party has left out some of the tax changes announced in this week’s budget, which the IFS describes as “legitimate, but a choice”. For example, Labour hasn’t accounted for “announcements on child benefit or on non-doms – even though both of those are actually income tax changes”. The OBR says that despite the increases in income tax, NICs, other taxes and the cost of living, real household income per person will be about £800 higher in 2028-29 than it was 2019-20.
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