The big increase in National Living Wage is a stealth tax
I’ve been looking at some of the numbers around this and they’re, unsurprisingly, somewhat different to the official line.
The government is trumpeting an increase of £930 a year for 35 hours a week work at NLW rates. That becomes £631 after tax and NI on current rates. Only worth £233 if you’re getting Universal Credit though as it reduces the benefit. There’s a further hit on Council Tax Rebate as well.
If you want the details, my blog post below points out the higher NLW from April looks much more like an up-to 88% stealth tax on employers than an effective way to make low paid workers better off?.
Will this increase also drag more people into the clutches of the benefit cap as they will now need more income to match 16 x NLW per week of income?[ Edited: 2 Jan 2020 at 06:10 pm by metahome ]
And I see that you’re being quoted on a similar point re the Greggs bonuses Gareth -
Yes, pretty much exactly the same point, except for the impact of paying it in a single month. I just did some simple calculations in https://benefitsinthefuture.com/greggs-300-bonus-or-booby-prize/ . Odd that Greggs has got much more traction than NLW despite affecting far fewer people and having a much smaller impact. More human interest, I suppose, and easier to grasp.