Martin Lewis Says There's 'One Bit Of Good News' For People Earning Under £50k

While the new chancellor’s ‘mini-budget’ last week contained little to give people hope of overcoming their current economic struggles, Martin Lewis has managed to find one nugget of hope. 

The newly-appointed Chancellor of the Exchequer, Kwasi Kwarteng, shared his emergency budget announcement on Friday, seeing him announce a host of changes to the UK's tax system in what has been labelled the biggest raft of tax-cuts since 1972.

In a statement to the House of Commons, Kwarteng said the government was ending the cap on banker bonuses as well as axing the 45% top rate of tax for people earning more than £150,000 a year - policies that have led to widespread criticism that he and new PM Liz Truss are handing billions back to the richest in society while the poorest choose between heating and eating. 

While the government has defended its decisions, justifying the cuts as wealth generating and business encouraging, it seems the international money markets beg to differ as, following the announcement, the pound has sunk to an historic low against the dollar spelling yet more price rises for any business who imports into the UK as well as on oil, gas and petrol, all of which are priced in dollars on the international markets. 

But, although it currently looks pretty bad for those of us who don’t already have bulging bank balances, Martin Lewis has highlighted one change that will help those earning £50,000 or less. 

Kwarteng also announced that the government is reducing the basic rate of tax, meaning that rather than 20%, earnings up to £50,000 will now be taxed at 19% (apart from the first £12,570 of our salaries that is tax free). 

Lewis said: “For anyone earning £50,000 and over, you don't really get any more gain. The gain is really on the income between £12,570 and £50,000.”

While people earning over £50,000 will still benefit from the reduction to the basic rate, they will still have to pay 40% on any earnings above that.

Elsewhere in the budget, the chancellor announced there would be immediate cuts to Stamp Duty, and that the increase in Corporation Tax proposed by his predecessor Rishi Sunak would be cancelled, with analysis by the Treasury estimating that the new plans would cost a staggering £161 billion over the next five years.

Labour’s Shadow Chancellor Rachel Reeves blasted the 'mini' budget as a 'comprehensive demolition' of the last 12 years of Tory government.

She said: “The costs of the energy price cap will be funded by borrowing, leaving the eye watering windfall profits of the energy giants untaxed.”

Reeves said it would be ‘working people left to pick up the bill’, adding: “It is a budget without figures, a menu without prices. What has the chancellor got to hide?"

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