Taxes and benefits

Next week will see the introduction of significant cuts to the generosity of two parts of the working-age benefits system. These will affect some new recipients of employment and support allowance, and any family receiving tax credits or universal credit who has either a newly born first child or a newly born third or subsequent child. The restriction to new claims or new births means that the changes will not result in existing claimants seeing their benefit income fall. But in the long run, these are substantial cuts: together they are expected to reduce government spending by over £5 billion a year in the long run. This observation discusses these changes.

On Monday, the House of Lords will debate recent changes to Personal Independence Payment (PIP) regulations. These changes are expected to save the government £910 million per year by 2021–22 by reversing the impact of two recent tribunal judgements on the criteria for receiving PIP. Important context is that despite this change, real-terms spending on disability benefits is forecast to be £23 billion in 2017–18, 35% higher than the £17 billion spent 2007–08. If spending had grown at the rate forecast as recently as Budget 2015, it would instead reach just £20 billion by 2017–18.

This presentation was given by Ross Warwick at "A taxing challenge? Analysing and supporting tax policy design in low and middle income countries" on 15 March 2017.

This presentation was given by Laura Abramovsky at "A taxing challenge? Analysing and supporting tax policy design in low and middle income countries" on 15 March 2017.

This presentation was given by David Phillips at "A taxing challenge? Analysing and supporting tax policy design in low and middle income countries" on 15 March 2017.

This presentation was given by Yani Tyskerud at "A taxing challenge? Analysing and supporting tax policy design in low and middle income countries" on 15 March 2017.

These slides are supplemetary material to the presentation given by Andrew Hood at the IFS post Budget briefing 2017.

IFS Deputy Director Carl Emmerson writes for The Times Red Box.

Alcohol consumption is associated with costs to society due to its impact on crime and health. Tax can lead consumers to internalise these externalities.

IFS Director Paul Johnson writes in The Times.

This presentation was given at the launch of the IFS Green Budget 2017.

In Budget 2016 the Chancellor announced a ‘soft drinks industry levy’ that aims to reduce consumption of sugar sweetened soft drinks. The levy is due to take effect from April 2018 with two rates, one applying to mid-sugar drinks (with 5-8 grams of sugar per 100 millilitres) and a higher rate applying to high-sugar drinks (with more than 8 grams of sugar per 100 millilitres). A recent article in The Lancet: Public Health considers the possible consequences of the levy for a series of health outcomes, such as obesity, type 2 diabetes and dental care. In this Observation we propose a simple change to the soft drinks levy which would increase the likelihood of it having a beneficial effect on these outcomes.