15 15 billion package from the government to alleviate the cost of living

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London, Thanasis Gavos

Measures with a total cost of δ 15 billion were presented by British Government aiming to relieve pressure causing it to households rising cost of living and especially the inflated energy bills.

As announced in the House of Commons at noon by the Minister of Finance of the United Kingdom Risi Sunak, 1/3 of these extraordinary benefits will be covered by an additional tax on the unexpectedly high profits of energy companies. Mr Sunak spoke of a “temporarily targeted contribution to energy profits”.

This is a change of attitude of the government, which until now resisted the request of the opposition for extraordinary taxation of large providerswhich recorded significantly higher profits despite the turmoil in the global energy market.

This profit tax is set at 25%, but companies can be relieved if they invest part of their profits in the energy industry. The surcharge will be phased out when wholesale prices return to “historically normal” levels.

The key measure announced by Mr Sunak is one 400 400 allowance for each household in the United Kingdom. This bonus replaces the 200 200 announced in February, which was criticized for being accompanied by a long-term consumer obligation. This obligation to return is no longer valid.

The Minister also announced an extraordinary allowance (in two installments) 50 650 for each of the approximately 8 million householdsreceiving low-income benefits.

Also, the 8 million pensioner households entitled to the heating allowance will receive an additional payment of 300 300 each.

Finally, the 6 million people receiving disability benefits will receive an additional 150 150.

Mr. Sunak estimates that the 8 million most vulnerable households in the country will have total benefit of 1. 1,200 from the new measuresan aid that almost covers the increases in energy bills that have already been made and that will be made in October.

Along with previous measures to tackle the accuracy he had announced, such as lowering the municipal fee for the poorest households, Mr Sunak said the government was helping citizens against accuracy with a total of λι 37 billion, or 1,5 1.5 billion. % of GDP.

“We can not solve all the problems, but we can ease the pressure,” said the British finance minister.

The shadow Minister of Labor Finance Rachel Reeves commented that the government’s reversal of the emergency tax on energy companies shows that its party is “winning the battle of ideas in Britain”. He also called for the abolition of VAT on energy for households.

In the first comments on the measures, the head of the prestigious Institute of Financial Studies Paul Johnson spoke of a “large and expensive package” which in combination with the tax increases announced becomes “very redistributive, taking from those with the highest incomes and giving to poor “.

Inflation in the UK has climbed to 9%, a 40-year high, and the Bank of England forecasts it will exceed 10% in the autumn.

The main reason is the unprecedented increase in energy bills for consumers. Bills have skyrocketed to 1. 1,971 a year for every household with typical energy consumption and are expected to reach around 2. 2,800 a year by October.

This is due to the successive increases that the competent regulator Ofgem has decided in the energy price ceiling, ie the maximum charge that can be imposed by the power companies on each kilowatt hour of gas and electricity consumed by the approximately 24 million households belonging to the basic variable billing invoices.

Political commentators note that with the announcement of the measures today, a day after the publication of Gray’s critical report on the parygate, the government is trying to divert attention from the debate on the responsibilities of Prime Minister Boris Johnson.

Source: skai.gr

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