London Daily

Focus on the big picture.
Monday, Oct 12, 2026

“The truth is we just got a lot poorer”

“The truth is we just got a lot poorer”

“I have come here to chew bubblegum and kick ass. And I’m all out of bubblegum.” This is not a direct quote from Paul Johnson, director the Institute for Fiscal Studies think tank, but it is a close approximation.
I have come here to chew bubblegum and kick ass. And I’m all out of bubblegum.” This is not a direct quote from Paul Johnson, director the Institute for Fiscal Studies think tank, but it is a close approximation.

As Britain’s tax burden is set to hit its highest levels since the Second World War, Johnson said he would be “most surprised” if it returns to “its long-term pre-Covid average at any time in the coming decades.” That is ‘decades’ plural.

Business Editor Jonathan Prynn has got his calculator out and estimates that the changes to income tax thresholds mean that 900,000 middle earners across London and the south east are set to be dragged into the higher 40p tax band over the next six years. We are talking workers such as teachers and senior nurses. Not minimum wage jobs, sure, but now deposited in a tax band never designed for them.

The Chancellor announced that the threshold, already frozen by Rishi Sunak until 2026, will now be left at £50,270 until 2028. For context, and it is an imperfect comparison, but a single person in the US only starts paying the top rate of federal income tax of 37 per on earnings in excess of $578,125. Which is more.

With all these taxes, we can expect high-quality public services, right? Anyone who has tried to secure a GP appointment or frankly interacted with the British state in any capacity might suggest otherwise.

Where is the money going? Much of it is now being siphoned off on debt interest. Johnson points out that by 2027-28, interest will hit £100bn a year – more than spending on any public service bar the NHS.

Whose fault is it? In addition to global headwinds, the fastidiously independent Johnson blamed the government’s “economic own goals” and years of “cakeism”.

The tragedy is most stark in the collapse in living standards. Real household disposable income per capita is expected to be a third lower in 2027–28 than we might have expected in 2008. A third! “The truth is we just got a lot poorer,” Johnson said. And the fact is, we weren’t doing that great to begin with.

The criticism of the British electorate has long been that we want US-style taxes with European-level services. Now, we are saddled with the opposite.

Elsewhere in the paper, you have 12 years to plan a world cup and then 48 hours before kick-off ban beer at the stadiums. Fifa could now face a legal challenge from Budweiser, one of the tournament’s major sponsors, over major breaches of the terms of their $75m partnership.

In the comment pages, Emily Sheffield warns that a bad hand played well still leaves Jeremy Hunt with a mountain to climb. While I say Qatar’s World Cup is an insult to LGBT fans. There’s also a bonus short on the legislation-passing machine that is Nancy Pelosi.

And finally, you lot love a Tube map. I’ve seen the click-through rates. So here’s a redesigned map showing the cheapest pints of beer near underground stations.
Newsletter

Related Articles

0:00
0:00
Close
UK Prime Minister Andy Burnham Meets German Chancellor Merz to Strengthen European Security Ties
Nearly 100,000 NHS Patients Treated in Hospital Corridors as England Braces for Winter Pressures
UK Government Rejects US-Russia Diesel Agreement and Reaffirms Sanctions Against Moscow
UK and Germany Agree to Deepen Security and Economic Cooperation Following Berlin Talks
British Prime Minister Burnham Pledges Closer EU Ties During Visit to Germany
UK Announces New Sanctions on 17 Russia-Linked Entities During Foreign Secretary's Ukraine Visit
UK and Germany Finalize Kensington Treaty to Strengthen Defense and Technology Cooperation
Britain Maintains Diplomatic Mission in East Jerusalem Despite Israeli Closure Deadline
English Councils Push Government to Rethink Proposed Funding Cuts
Scottish Homebuilding Falls to Lowest Level in 11 Years
BBC Chief Matt Brittin Defends Restructuring as Staff Challenge Job Cuts
UK Finance Warns High Energy Costs and Bond Yields Are Complicating Fiscal Outlook
UK Adopts All 44 Recommendations on Regulating AI in Healthcare
Chancellor John Healey Prepares Autumn Budget as Borrowing Costs Strain Public Finances
UK Investigators See Strong Indications of Iranian Link After RAF Fairford Security Operation
Laura Trott Pledges Tighter Controls on Political Activism in UK Classrooms
Welsh Ministers Launch Long-Term Review of North Wales and Anglesey Crossings
Welsh Government Orders 18-Month Study of Road Solutions Around Newport
Reform UK MP Sarah Pochin Faces Scrutiny Over £800,000 Second Home Purchase
British Households Grow More Concerned About Fuel and Energy Prices
NHS Leaders Warn of Rising Winter Pressure on Emergency Departments
Kemi Badenoch Proposes £2.3 Billion Employer National Insurance Cut for Young Workers
Middle East Conflict Could Erase UK Fiscal Headroom, Economists Warn
Manchester City Found Guilty of Multiple Premier League Financial Rule Breaches
UK Security Services Find Strong Indications of Iranian Role in RAF Fairford Incident
Costa Coffee Returns to Operating Profit on Iced Drinks and Menu Changes
Asos Warns Customers After Unauthorized Access to Retail App and Data
Kemi Badenoch Puts Growth and Deregulation at Center of Conservative Conference
Campaigners Warn of Deepening Social Care Crisis for Disabled Adults
Study Finds Rising Early-Onset Cancer Rates Among Adults Under 50 in Britain
UK Coach Operators Warn High Diesel Prices Could Force Route Cuts
FCA Opens Independent Review Into Handling of Epstein-Linked Whistleblower Case
Argentina Vows to Block Falkland Islands Offshore Oil Development
UK Chancellor Prepares Fiscal Measures and Welfare Reforms Ahead of Autumn Budget
Sainsbury’s and Morrisons Explore Potential Multi-Billion-Pound Merger
UK Weighs Tariffs on Chinese Electric Vehicles to Align With European Union
UK Threatens Diplomatic Expulsions Over Planned Closure of East Jerusalem Consulate
UK Energy Price Cap Hits Three-Year High as Middle East Conflict Raises Costs
Seventh Arrest Made in Suspected Terror Plot at RAF Fairford
Systemic Education Collapse Sparks Mass Student Uprisings in France
Green Party Faces Backlash Over Resolution Equating Zionism With Racism
Conservatives Debate Scrapping Environmental Rules for New Homes
Cornwall Insight Warns UK Energy Bills Could Approach £2,000 This Winter
UK Coach Operators Warn of Service Cuts as Diesel Prices Exceed £2
Scottish Parliament Approves £68 Billion Budget With New Tax and Property Measures
FCA Opens Independent Review Into Handling of Epstein Whistleblower
UK Government Drops Plan to Suspend Jury Trials in England and Wales
Bank of England Holds Interest Rate at 3.75% as Markets Watch November
Two Iranian Nationals Charged Over Alleged Plot Targeting Manchester Jewish Community
UK Fiscal Headroom Halves to £11 Billion Ahead of Budget, EY Warns
×