Rishi Sunak’s energy loan will be ‘cancelled’ by £342 tax hike facing workers


Shadow Chancellor Rachel Reeves has warned that Tory Rishi Sunak is ‘trapping us in a cycle of high taxes and low growth’

The average worker faces a £342 tax hike over the next year, according to new analysis from Labour.

And the National Insurance hike next month will nearly wipe out Rishi Sunak’s proposed loan scheme to tackle soaring energy prices.

The Chancellor has promised households £200 off the energy bills they have to pay off and a £150 rebate on council tax.

But Shadow Chancellor Rachel Reeves said: ‘It locks us into a cycle of high taxes and low growth, with workers paying the price.

“The government has let the cost of living crisis spiral out of control and will now make it worse with an unfair tax hike.”

Labor instead wants a windfall tax on oil and gas producers to cut bills by up to £600 for those on the lowest incomes.

Shadow Chancellor Rachel Reeves


Getty Images)

The tax hike comes on top of rising food and fuel prices, as the Resolution Foundation think tank says the cost of living crisis is set to make families worse off by £1,200 a year.

New official figures show that one in five businesses fear the effects of rising energy costs on their business.

Shadow Business Secretary Jonathan Reynolds called for action in the Chancellor’s Mini Budget later this month.

He added: “The cost of doing business is rising and companies are feeling the pressure.

“Now is not the time for the Chancellor to walk away and hope for the best.”

A Treasury spokesman said: “The Health and Social Care Levy will provide a permanent source of funding needed to support the NHS and repair the welfare system.

“We are providing around £21billion this financial year and next to help families with the cost of living, including an increase in the National Living Wage, which means those working full time will see an increase of £1,000 of their annual income.”

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