Why the budget is regressive rather than progressive (2)
Further evidence is now emerging that the tough budget is not as fair as the Chancellor was pretending. The respected Institute for Fiscal Studies (IFS) has produced this analysis.
As explained in this “Guardian” editorial:
“As the IFS pointed out, the reason the measures looked so fair was because they took into account the announcements made by Labour in its last few budget statements – higher taxes on income, the clampdown on rich people’s pension relief and so on. Strip those out to look at the measures brought in by the Cameron government – the rise in VAT next January, the uprating of benefits in line with inflation as measured by CPI rather than the higher RPI – and the burden falls heaviest on the poorest. Indeed, by the end of the parliament, the IFS finds that the total cost of Mr Osborne’s budget was to make the poorest section of society 2.6% worse off, while leaving the richest only 0.6% down.”