UK Covid cost: How much will the pandemic cost? How much will taxes go up?
The Treasury has spent billions throughout the coronavirus pandemic keeping the UK afloat through schemes such as furlough and business loans. Two new reports have exposed the “significant financial risks” that could be on the way for the taxpayer. The reports, on the response by Prime Minister Boris Johnson’s government to the COVID-19 pandemic, parliament’s Public Accounts Committee (PAC) said lessons needed to be learned before a promised public inquiry due to be held in 2022.
The PAC said there have been unacceptably high levels of wasteful spending, with 2.1 billion items of unusable PPE purchased – equating to £2 billion of wasted public money.
A Department of Health and Social Care spokeswoman responded: “There are robust processes in place to ensure that government spending always provides value for money for the taxpayer.
“We have worked tirelessly to source life-saving PPE to protect health and care staff, and we have delivered over 12.7 billion items to the frontline at record speed.”
Meg Hillier, the PAC chair, said: “With eye-watering sums of money spent on COVID measures so far the government needs to be clear, now, how this will be managed going forward, and over what period of time.
“The ongoing risk to the taxpayer will run for 20 years on things like arts and culture recovery loans, let alone the other new risks that departments across government must quickly learn to manage.”
The amount people can earn before paying a 40 percent tax rate instead of 20 percent will also be frozen.
Businesses will also pay more tax, as the rate of tax on their profits – corporation tax – will rise from 19 percent to 25 percent in 2023.
There is also likely to be a rise in National Insurance contributions, with a new rate of a penny for every pound brought in.
There is rumoured talk of the scrap to the triple lock on state pensions, as the pandemic may inflate the money given to pensioners artificially instead of
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