Income tax threshold freeze will hit poorer households harder, experts say

Millions of low-to-middle earners would have been better off with their tax rates rising than their thresholds being frozen, the Resolution Foundation chief said. Photograph: Ascannio/Alamy

Rachel Reeves will punish poorer households more than the better off through the freezing of income tax thresholds announced in Wednesday’s budget, two major thinktanks have said.

The Resolution Foundation said the freeze on income tax thresholds for a further three years to 2031 would harm the living standards of taxpayers in the bottom half of the income scale.