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Budget 2015: Who has George Osborne shafted the most after five years in power? ... The poorest and the youngest | |
(about 14 hours later) | |
The poorest in society and those in their 20s have been hit the hardest by George Osborne’s five budgets. | The poorest in society and those in their 20s have been hit the hardest by George Osborne’s five budgets. |
That’s the verdict of the influential think thank the Institute for Fiscal Studies, which delivered its traditional post-budget assessment this afternoon. | That’s the verdict of the influential think thank the Institute for Fiscal Studies, which delivered its traditional post-budget assessment this afternoon. |
The authoritative briefing by Paul Johnson, director of the IFS, said the “poorest have seen the biggest proportionate losses” from the tax and benefit changes introduced by the Coalition. | The authoritative briefing by Paul Johnson, director of the IFS, said the “poorest have seen the biggest proportionate losses” from the tax and benefit changes introduced by the Coalition. |
Meanwhile the age group that saw the biggest falls in incomes were those in their 20s. | Meanwhile the age group that saw the biggest falls in incomes were those in their 20s. |
It has been a “very different” story for pensioners however, with the over 65s seeing average incomes rise as they benefited from a range of Coalition pension reforms. | It has been a “very different” story for pensioners however, with the over 65s seeing average incomes rise as they benefited from a range of Coalition pension reforms. |
Overall, average incomes had “just about regained their pre-recession levels,” Mr Johnson said, but there was “no cause for celebration” as the modest growth represented “by far the slowest recovery in incomes in modern history”. | Overall, average incomes had “just about regained their pre-recession levels,” Mr Johnson said, but there was “no cause for celebration” as the modest growth represented “by far the slowest recovery in incomes in modern history”. |
“We are for sure much worse off on average than we could reasonably have expected to be back in 2007 or indeed back in 2010,” he said. | “We are for sure much worse off on average than we could reasonably have expected to be back in 2007 or indeed back in 2010,” he said. |
Those in their twenties have seen the biggest fall in their incomes since the Coalition came to power (PA) | Those in their twenties have seen the biggest fall in their incomes since the Coalition came to power (PA) |
So who had benefited the most from the government’s changes in tax and benefits? The middle classes, according to Mr Johnson. | So who had benefited the most from the government’s changes in tax and benefits? The middle classes, according to Mr Johnson. |
“People on middle and upper middle incomes have been remarkably insulated on average from tax and benefit changes.” | “People on middle and upper middle incomes have been remarkably insulated on average from tax and benefit changes.” |
This was due to the constant rises in personal tax allowances. The personal allowance was £6,475 when the Coalition came to office. It rises to £10,600 next month, an increase of 64 per cent over five years. | This was due to the constant rises in personal tax allowances. The personal allowance was £6,475 when the Coalition came to office. It rises to £10,600 next month, an increase of 64 per cent over five years. |
Ed Miliband said George Osborne had presided over a 'recovery for the few' (PA). | Ed Miliband said George Osborne had presided over a 'recovery for the few' (PA). |
However the higher rate threshold has fallen over the period from £43,875 to £42,385, dragging millions more people into the 40p tax rate. | However the higher rate threshold has fallen over the period from £43,875 to £42,385, dragging millions more people into the 40p tax rate. |
Those on the highest incomes were hit the hardest by tax rises, the IFS found. | Those on the highest incomes were hit the hardest by tax rises, the IFS found. |
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