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This Saturday (6 April 2019) marks the start of a new tax year. Unlike many other countries, the UK routinely – and sensibly – uprates the cash values of most tax thresholds and benefit rates each year in line with inflation, in order to maintain their real value.
In a number of cases, however, this routine uprating has now been cancelled for extended periods:
- The inheritance tax threshold has been fixed at £325,000 since 2009–10.
- Fuel duties have not increased in cash terms since April 2010.
- Most working-age benefits have been frozen in cash terms since 2015–16.
- The VAT registration threshold has been frozen at £85,000 since April 2017, and the last Budget announced that it would remain frozen until April 2022.
Some of these policies raise revenue; others give money away. But in neither case is it sensible policymaking.
Authors
![Stuart Adam](/sites/default/files/styles/square_desktop/public/2022-06/Stuart_Adam.jpg?itok=WhMGYiwy)
Senior Economist
Stuart is a Senior Economist working in the Tax sector, and focuses on analysing the design of the tax and benefit system.
![Paul Johnson](/sites/default/files/styles/square_desktop/public/2022-11/Paul%20J%202022%20Official%20portrait_0.jpg?itok=JAN23N1X)
Director
Paul has been the Director of the IFS since 2011. He is also currently visiting professor in the Department of Economics at University College London.
Report details
- DOI
- 10.1920/BN.IFS.2019.BN0247
- ISBN
- 978-1-912805-19-8
- Publisher
- IFS
Suggested citation
Adam, S and Johnson, P. (2019). Dragging people into higher rates of tax. London: IFS. Available at: https://ifs.org.uk/publications/dragging-people-higher-rates-tax (accessed: 30 June 2024).
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