Budget 2012: Impact per decile – the poorer you are, the harder you’re hit

Aside from the top decile, the poorest ten per cent will be hit the hardest by George Osborne’s budget, reports Shamik Das.

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The “we’re all in it together” line was missing from today’s budget – and no wonder, when one looks at the distributional impact of George Osborne’s latest proposals and previous announcements.

As Chart B2 of the Budget 2012 Red book (pdf) shows, the cumulative effect of this budget and previous announcements is regressive for the bottom eight deciles. The ninth decile pay less proportionally than the poorest half of people. But the budget is progressive when looking at the richest 10 per cent versus the rest.

Chart B2:



See also:

Budget 2012: It may do nothing for growth, but the fat cats will purr more loudly 21 Mar 2012

The charts that shame the “we’re all in this together” coalition 16 Mar 2012

Autumn statement 2011: “We’re all in this together” – when ‘we’ means the bottom 80% 29 Nov 2011

Budget 2011: Distributional analysis of coalition’s major tax changes 24 Mar 2011

How the government lost the fairness argument 8 Jan 2011


Up to eighth decile the richer you are, the less you’re impacted – with the ninth decile still paying less than the poorest 50 per cent. If this is Mr Osborne’s definition of a “fair” distribution of pain, we’d hate to see what he’d come up with if he sat down and really put his mind to penning an “unfair” budget…


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