Increases in taxes in the UK introduced by Chancellor George Osborne in his Budget earlier this month look set to push the cost of living up. According to the latest figures from the Office for National Statistics, the consumer price index (CPI) one-monthly rate will rise by 0.38 per cent as a result of new taxes on hot food sold in retail outlets, higher duties on fuel and rises on taxes on cigarettes and alcohol. The increase means that many people will still be feeling the squeeze, even after the dip in the top tax rate from 50 per cent to 45 per cent. Last month CPI stood at 3.4 per cent, slightly higher than had been expected and ahead of the Bank of England's target rate of two per cent. Fortunately, pay settlements do seem to be gradually improving, suggesting that the pressure might start to be relieved for some in the months ahead. Pay settlements are now at an average of three per cent, up from the 2.5 per cent recorded this time last year. Ken Mulkearn, from Income Data Services, which compiled the figures, told City A.M.: “Higher-level awards – at four per cent or above – are being made in sectors where prospects have brightened recently.”
http://www.50percenttax.co.uk/index/2012/4/2/cost-of-living-set-to-rise-due-to-tax-hikes.html
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