Vidhya Alakeson, a researcher from the United Kingdom has spoken out at a conference in Cork to state that tax breaks given to middle income groups would be far more beneficial to the UK economy than abolishing the 50p tax rate.
Alakeson is from the Resolution Foundation, which aims to benefit people in the UK who have low to middle incomes. As the director of research and strategy, Alakeson believes that the £2 billion tax break which may be given to the wealthiest in the country by removing the 50p rate of tax, would probably be used by them to increase their savings. However, if the £2 billion was spent on tax breaks for people who are in the bracket for low to middle incomes, people would be spending the extra money on consumer items like food and fuel. Economic growth would be stimulated by them reinvesting in the UK economy.
Alakeson also considers that Ireland could benefit from the argument to give tax breaks to the six million families which are in the low to middle income group, as although inflation isn’t as high as it is in the UK, low earning families are feeling the squeeze, financially. She also stated that the setting of wages should be the target of reform, as low paid sectors experience different rates of pay, although being situated in the same areas. Minimum wage reform for low paid employees would create jobs and provide long term viability for small businesses in lower paid sectors.
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