Tax cuts will benefit people in low paid jobs

The government’s plans to reform the tax system will mainly benefit working people on low or middle incomes, according to cabinet figures.

Workers earning less than 175% of the minimum wage will see their spending power increase by 3%, while people earning over five times the minimum wage will benefit from 1.5% extra disposable income.

On average, people in work will have 2% more to spend, the cabinet figures show.

However, households where no one works and pensioners will not benefit from the income tax adjustments.

‘The tax cuts are aimed at low and medium income workers in order to stimulate more people to get jobs,’ tax minister Eric Wiebes said in a briefing to parliament.

MPs are debating the tax reforms on Wednesday afternoon.