The United Kingdom raises its minimum wage by 6.6%, but almost half of the increase will go on taxes

With runaway inflation in the United Kingdom, the Government leaked this Monday that it will raise the minimum wage by 6.6%, to about 1,520 pounds per month (1,800 euros), accepting the recommendations of the Low Wages Commission, an advisory organization to the Government . However, the criticism has not been long in coming, because a large part of that increase will go to taxes and cuts in other income.

From the outset, Boris Johnson’s Cabinet has, to increase revenue for the health system. As the Liberal Democratic Party denounces, the result would be that 44% of the increase -about 48.4 euros for 100 extras- “will go into taxes before even reaching the workers’ bank accounts.” “This measure is just more nonsense from an administration more interested in passing unfair tax increases and breaking promises than protecting the vulnerable,” Liberals Chairman Mike Dixon said.

For its part, the Institute of Fiscal Studies pointed out that this increase will be limited to about 250 pounds per year for full-time workers who supplement their meager salaries with the Minimum Income, given that they will suffer a cut of about a thousand pounds per year in this concept. . Given that 37% of the recipients of this subsidy are working, some 2,160,000 people between England, Wales and Scotland, the effect of this increase will be rather limited precisely for the most needy people: those who, due to the cost of living in the areas where they live or because of their family situation they need more than the minimum wage to survive.

The Labor Party has demanded the increase to 1,600 pounds (1,900 euros) and the recovery of the thousand pounds per year cut from the Minimum Income, in addition to a VAT cut on electricity bills — for six months for the most needy families. The YouGov pollster carried out a poll before the announcement indicating that half of Britons consider the figure of 1,600 pounds as the most suitable for the minimum wage, with 1,760 (2,090 euros) as the second most supported figure by the population.

Finance Minister Rishi Sunak is due to present the budget on Wednesday, which is expected to include some 31 billion pounds in new government spending. Almost 6,000 million will go to the health system, 1,500 to public transport, more than 6,000 to education, both for young people and adults, and 2,000 million to build new homes on wasteland with no other use.