Wednesday, 25 August 2010

Regressive Punch v Progressive Judy

The Institute for Fiscal Studies has expanded on its June criticism of the Emergency Budget as being regressive.  It has lauched a research document expanding its argument (pdf file).  It says that: 

"In our post-budget briefing, we cast doubt on this claim, demonstrating that many of the progressive tax rises that will be introduced over the next two years were announced by the previous Government, and that the Budget measures scheduled to come in between 2012 and 2014 are generally regressive. Moreover, the distributional analysis in the Budget documentation did not include the effects of some cuts to housing benefit, Disability Living Allowance and tax credits that are likely to affect the poorer half of the income distribution more than the richer half."

However, critics of the report say the IFS model omits a number of policy shifts that will have a positve impact.

UPDATE:  Clegg has come out swinging over the report.

UPDATE 2:  Guido argues that the Coalition shouldn't be fighting on this ground.

No comments: