Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

Inflation and tax rises will leave 5.3m with no savings, says think tank

by August 3, 2022
August 3, 2022
Inflation and tax rises will leave 5.3m with no savings, says think tank

Inflation and a growing tax burden will lead to 5.3 million people having no savings by 2024, equal to one in five of all households, a leading economic think tank has said.

In its latest forecast the National Institute of Economic and Social Research said that about seven million families would be living “paycheck to paycheck”, while for 1.2 million people energy bills would exceed disposable incomes by next year.

The think tank projects that the economy is on course for a recession in the coming months as rising energy and food bills and higher taxes lead to a “permanent” fall in households’ disposable incomes.

It said that the new prime minister should instruct their chancellor to use falling debt and deficit levels to fund welfare increases for millions of households at risk of having to choose between “eating and heating”.

Adrian Pabst, deputy director for public policy at the institute, said that the most vulnerable households would have to “resort to credit, build up payment arrears, or see their savings wiped out”, adding: “The incoming government must provide immediate emergency support … as the energy price cap rises and recession begins to bite.”

In their Tory Party leadership campaigns, Rishi Sunak, the former chancellor, and Liz Truss, the foreign secretary, have both promised cuts to personal income tax and VAT on energy to stimulate economic growth and reduce a tax burden on course to rise to the highest since the end of the Second World War.

The institute said the windfall from higher inflation and taxes could fund schemes targeted at households at the front line of the energy and food price crisis. It also called for a £25-a-week increase in universal credit for at least six months starting from October, which would cost about £1.35 billion, coupled with an increase from £400 to £600 to the announced energy bill rebate for 11 million low-income families.

Both measures could be funded by the fiscal headroom resulting from the budget deficit falling from 5.1 per cent of GDP in 2022-23 to about 1 per cent the year after. The think tank slashed its UK growth forecasts to 3.5 per cent this year and 1 per cent in 2023, and warned that a formal recession would hit this quarter.

Read more:
Inflation and tax rises will leave 5.3m with no savings, says think tank

0
FacebookTwitterGoogle +Pinterest
previous post
Mortgage costs hold back house prices
next post
Following My Trades

You may also like

Building a Global Business: The Importance of Strategic...

March 25, 2025

Poundland to shut 68 stores in restructuring that...

June 17, 2025

Mastering the Art of Business Growth: Essential Strategies...

January 22, 2024

Saudis buy 49% stake in Forte Hotels group

December 5, 2023

How strong is your business partnership?

September 7, 2024

Pranks and anonymous messaging games between friends

March 9, 2023

Could Labour’s plan to put VAT on private...

July 16, 2024

UK biostimulant startup SugaROx raises £1m to fast-track...

August 19, 2025

Explore the Best Apple Watch Wristbands for Active...

November 20, 2024

The Rise of Sports Betting: Market Trends and...

November 4, 2024

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • ‘Bold’ general who led US’ ‘Midnight Hammer’ strikes on Iran ends Middle East reign

      August 25, 2025
    • Democrats opposed John Bolton for years — until they sought him as an ally against Trump

      August 25, 2025
    • Top GOP senator defies Trump demand to bend Senate rules for his court picks

      August 25, 2025
    • Patients Using Popular Meds May Face a Tariff Hit: US–EU Trade Deal Targets Branded Drugs Like Ozempic and Wegovy

      August 25, 2025
    • What Automatic Planning and Scheduling Means for Your Projects

      August 25, 2025
    • Ultimate Traders Review: Easy and Effective Prop Trading

      August 25, 2025

    Categories

    • Business (8,876)
    • Investing (2,236)
    • Politics (16,481)
    • Stocks (3,228)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved