“They’ll put minimum wage up, but that’s hand in hand with a tax rise,” the 45-year-old told The i Paper.
The town ranks in the bottom 10 cities with the lowest wages in the UK, with an average salary of £31,000 per year – London ranks at the top with £49,000.
“The wages don’t increase like the cost of housing,” she said, adding that the tiny two-bedroom maisonette that she shares with her son costs £1,200 a month.
The Office for Budget Responsibility (OBR) on Wednesday said income tax receipts – excluding self-assessments – were on track to hit £322bn by 2029-30, up from the £313.8bn previously forecast in October.
Fiscal drag
Freezing the value of tax thresholds combined with rising wages, means that more people will pay higher tax without the Treasury raising it directly. – this is know as fiscal drag.
According to the Institute of Fiscal Studies, only 3.5 per cent of adults in the UK paid the 40 per cent higher rate in 1991-92.
By 2022–23 11 per cent were paying higher rates, with that figure set to reach 14 per cent by 2027–28, the institute said in 2023.
As a result of the income tax threshold freeze, real household disposable income will be 1.4 per cent lower by 2027–28 than would have been the case if the personal allowance had been increased.
The institute said that an additional 2.5 million people would be dragged into the 40 per cent rate or higher by 2027/28.
The tax thresholds:
Personal allowance: Up to £12,570 (0%) Basic rate: £12,571 to £50,270 (20%) Higher rate: £50,271 to £125,140 (40%) Additional rate over £125,140 (45%)Analysis shows that frozen tax bands and higher inflation will cost workers thousands in additional income tax over the next three years.
Middle earners on £35,000 are set to pay £845 more, up from £801, while someone on a £20,000 salary would pay £282 in additional tax compared to £267 previously.
“People have less money to go around so they’re struggling,” he said. “I’ve seen people bid for rents and being priced out. Those things are really difficult to see.”
Spencer Cartwright, 54, and James Critchley, 47, say it’s too early to judge Labour on its performance in government
He said he has friends who live in Bournemouth but work in London, which allows them to afford the higher cost of living.
Sue and Ian have retired in Bournemouth and said the city is filled with students and retirees. Working people struggle to afford housing in the city, Sue said.
Ian said Bournemouth needs to decide what type of place it needs to be. It used to be a seaside town but since it became cheaper to holiday abroad in places like Spain, tourism has dried up and with it, the local economy has suffered.
square PENSIONS State pensioners to pay over £60 in income tax by 2027
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Sue is a Waspi woman who believes Labour should agree to pay partial compensation for those affected. She had to delay her retirement due to changes in the retirement age.
Spencer said the Government needed to make cuts to become more efficient.
He said he’s not worried about income tax because he’s retired and increasing defence spending was a priority due to historic underfunding by previous governments. “But taking that out of overseas aid was a bit of a sting,” he added.
Rachel Reeves also restored £9.9bn of fiscal “headroom” – the difference between the amount the Treasury is borrowing and the maximum allowed under the rules .
The Chancellor said: “There are no quick fixes, no shortcuts to prosperity, but we have returned stability to our economy. We have brought back security for working people, and we are delivering national renewal.”
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