Experts on the financial hardship of pensioners have rushed to criticize the government over the cut in income tax from 20p to 19p, saying it is ‘just a band-aid’ for the sector. Financial adviser Andrew Megson, executive chairman of My Pension Expert, pointed to the unbearable weight of the cost of living crisis, which is seeing inflation sit at a 30-year high of 6.2%.
Due to soaring costs, Mr Megson said the tax cut, along with the introduction of the triple lockdown, would be welcome.
However, he added that these measures are “just a band-aid” for pensioners and called for the imposition of a series of additional measures.
Mr Megson noted that “systematic changes will be needed to offer meaningful support” to people in retirement or early retirement.
For example, he suggested the government should simplify the pension system to benefit pension planners, based on research that showed 64% of Britons aged 40 and over needed the change.
The same research highlighted that almost half (47%) would like to see the government improve access to independent financial advice.
The expert concluded: “Clearly, the UK’s pension problems go far beyond simple monetary support.”
Despite the fact that such changes would take time, Mr Megson urged savers to seek financial advice in order to gain confidence in “such economic uncertainty”.
Torsten Bell, chief executive of the Resolution Foundation, said: “Pensioners are stuffing themselves this year without help (because they are largely not paying national insurance and the state pension is rising much more slowly than prices) but earn ridicule longer term lower income tax, higher national insurance.”
The measures announced on Wednesday were also criticized by mobility equipment provider Middletons Mobility, which pointed to a lack of support for the elderly and disabled.
Verity Kick, the company’s chief marketing officer, said: “As costs rise, the announcement in today’s Spring Statement that there will be no additional support for the elderly or disabled is an additional blow for these communities”.
Ms Kick explained that people with disabilities generally have higher energy needs than the general public, while the use of electric wheelchairs, stair lifts and extra washing due to medical conditions “cannot be reduced”. .
She added: “Rising energy bills jeopardize the quality and safety of everyday life.”
The company representative noted that the cost of living for people with disabilities has increased over the past three months, which has worsened their long-standing condition, as well as their mental health.
The Taxpayers Alliance also criticized the 1 pence cut in income tax, pointing out that the difference will not be visible due to the National Insurance hike.
John O’Connell, the Alliance’s chief executive, said: “While a cut in income tax is welcome, in reality the Treasury is taking with one hand and giving with the other.”
He added: ‘The income tax cut will be easily offset by the forthcoming National Insurance hike and the freezing of income tax thresholds, leaving taxpayers broadly out of pocket.
“If the government wants to give taxpayers and businesses a break from the hikes, they would do well to simply scrap the health and social services tax.”
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Source: www.express.co.uk
This notice was published: 2022-03-23 14:56:00
