In a recent analysis, BBC Verify examined the financial impact of the latest Budget on various income groups. The findings reveal significant discrepancies in how different classes will be affected by new tax measures.
Impact of Budget on Income Groups
The Treasury’s analysis indicates that by the fiscal year 2028-29, income reductions due to the new tax measures will significantly affect the wealthiest earners. The top 10% of earners in the UK are projected to see their incomes decline by approximately £2,000.
In contrast, the effects on middle-income earners are notably less severe, with a projected income decrease of about £300. The bottom 20% of earners are also expected to experience a minor reduction of around £200.
Benefits for Lower-Income Groups
Despite these tax burdens, the Budget includes measures designed to support those on lower incomes. The Treasury asserts that individuals with less financial means will benefit more than wealthier individuals from initiatives such as:
- Reduction in electricity bills
- Freezing of fuel duty
- Elimination of the two-child limit
These strategies aim to alleviate some of the financial pressure faced by the lower-income bracket. However, it is noteworthy that the top 30% of earners will see minimal cash gains from these reforms.
Overall Economic Performance
It is important to consider that the projected impacts only reflect the income changes due to the Budget measures. The broader implications for individuals across all income levels in the UK will largely depend on future economic conditions and performance.
El-Balad continues to monitor how these changes unfold and their potential effects on the UK economy.
