Families urgently need a tax cut to tackle rising living costs

The country is facing a severe cost of living crisis that has engulfed many families. The government’s response to this emergency has demonstrated a lack of any clear strategic vision. Boris Johnson has given households an eye-watering tax bill and offered a halfhearted rebate that is dwarfed in rising prices.

Even after the Chancellor’s support measures, the rise in National Insurance, the freeze on income tax thresholds, and increased energy bills will leave households £800 poorer this year. In just two months, the government’s policies have already cost families an average of £180 – all while 1,370 children are expected to fall into poverty each day, according to Resolution Foundation estimates.

Not content with raising the cost of living, Treasury Minister Simon Clarke recently asked workers to show “collective society-wide responsibility” and agree to low pay increases that will leave them poorer in real terms. The government asked workers to accept the inflation-related damage to their budgets.

This refusal by Boris Johnson to increase wages in line of inflation opens the door for economic disaster. By decreasing households’ spending power, Boris Johnson will reduce demand across the economy, starving struggling high streets of business, and driving the UK further towards a recession. It is evident that not one government member has any idea of the pressures workers are under.

Families are being asked to pay more tax and accept lower pay, but the Prime Minister and the Chancellor have worked extremely hard to protect the interests and big business.

In June of last year, the UK government pushed President Biden to drop the proposed global minimum corporation tax from 21 to 15 per cent, costing the taxpayer £6.8 billion a year. In the autumn, the Chancellor went on to hand big banks a tax cut that will cost the taxpayer £7 billion over the next four years. Last but not the least, the government delayed the windfall oil and gas producer tax. Had this been brought in just a few months earlier, the Treasury would have received almost an extra £3 billion in revenue.