More people now pay 51% direct tax on their earnings

One point that has been overlooked so far is the damaging effects on opportunity for middle earners.  The Chancellor yesterday reduced the higher rate threshold of income tax from £36,000 to £35,400.  Reform’s latest report on social mobility raised the idea of ‘mobility blocks’ – key points in the tax and benefits system that undermine mobility.  The upper rate threshold is one of these blocks.  Adding on National Insurance Contributions, the Chancellor moved thousands more people into the position of paying 51 per cent direct tax on their earnings.