Low income families’ tax burden risen by nearly a fifth even before NICs rise takes hold, says Labour

Labour have slammed the government after it emerged that low income families will see their tax burden rise by nearly a fifth – and that’s before the National Insurance rise and cost of living crisis takes hold. 

The party pointed towards how the tax burden has gone up dramatically in just two years for those on low incomes. 

It comes as the cost of living crisis continues to escalate, leaving families feeling worse off and they face tax hikes, rising food and energy bills, and soaring petrol prices. 

Shadow Chancellor of the Exchequer, Rachel Reeves said: 

“Right now, people are being hit by a cost-of-living crisis which has seen energy bills soar, petrol and food prices up and the weekly budget stretched.

“That’s why Labour is calling on government to immediately remove VAT on household heating bills over the winter months. 

“On top of the highest tax hikes in 70 years, Conservative complacency is leaving working people paying the price.”

Ends 

Notes to editors

• Data from the ONS’s “effects of taxes and benefits of household income.” The analysis compares direct and indirect taxes as a percentage of gross income for the poorest fifth of households from 2017-18 and 2019-20. Data from before FYE 2018 is not comparable because it ranks by household rather than individual income.  FYE 2020 and 2018 edition, table 8, https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/datasets/theeffectsoftaxesandbenefitsonhouseholdincomefinancialyearending2014
• Tax as a percentage of gross income rose from 36.4% to 42.4% between 2017-18 and 2019-20, a six percentage point increase of 16.5% per cent increase in the tax burden in just two years.