‘Hard to imagine a worse response to a cost of living crisis’
The Chancellor has been widely criticised for delivering a mini-budget that is “unashamedly for the rich” after he outlined measures to get Britain through the cost-of-living crisis.
Deploying the much-maligned theory of trickle-down economics, Kwasi Kwarteng abolished the top rate of income tax for the highest earners as he spent tens of billions of pounds in a “gamble” to promote growth.
From April, the 629,000 earners getting more than £150,000 a year will no longer pay the top income tax rate of 45 per cent and will instead pay the 40 per cent applicable to those on over £50,271.
He also axed the cap on bankers’ bonuses and added restrictions to the welfare system, arguing that tax cuts are “central to solving the riddle of growth”.
A whopping 120,000 people on Universal Credit will now have to take active steps to seek more and better-paid work or face having their benefits reduced.
Responding to the announcement, Guardian reporter Pippa Crerar described it as an “unashamed budget for the rich”.
🚨Kwasi Kwarteng announces govt is scrapping 45p additional rate of income tax – paid by richest 629,000 who earn more than £150,000. An unashamed budget for the rich.
— Pippa Crerar (@PippaCrerar) September 23, 2022
Former Labour leader Jeremy Corbyn and former Shadow Chancellor John McDonnell also made their thoughts known.
A budget truly for the 1%. Abolishing the 45p rate of tax benefits the richest 1% in our society. Combined with lifting the cap on bankers’ bonuses and threatening to cut the benefits of the unemployed this forms the most socially divisive budget in a generation.
— John McDonnell MP (@johnmcdonnellMP) September 23, 2022
This government's bankers' budget is a gift for the few and a slap in the face for the many.
Truss, Kwarteng & Co. are doubling down on tax cuts for the rich, handouts for bankers, dirty fossil fuels and attacks on workers.
We need a massive change, not more of the same.
— Jeremy Corbyn (@jeremycorbyn) September 23, 2022
While Jo Maugham did some number crunching to find that those earning a million pounds a year will have £54,400 extra in their pockets, while for those earning £25,000, the equivalent figure is about £280.
Liz Truss' budget means that those earning a million a year will have £54,400 extra in their pockets after tax and NICs. For those earning £25,000, the equivalent figure is about £280.
Hard to imagine a worse response to a cost of living crisis.
— Jo Maugham (@JolyonMaugham) September 23, 2022
Related links:
- Alcohol duty frozen in Mini-Budget meaning pints are set to be cheaper
- George Osborne’s austerity measures were based on a ‘spreadsheet error’
- Liz Truss admits her tax cuts will benefit the rich more than the poor – and she’s ok with it
- Liz Truss ‘preparing to scrap sugar tax’ on soft drinks
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