The news that inflation is down to 3.4 per cent from over 11 per cent in October 2022, is a clear sign the economy is turning a corner.
It is the fastest fall in inflation since the 1980s and means it is now at its lowest level in nearly two and a half years. Importantly it is also forecast to hit the Bank of England’s 2 per cent target within months.
Beneath that headline is more good news for families, with food inflation down to 5 per cent compared to nearly 20 per cent a year ago.
It’s a sigh of relief after a tough few years for the British economy.
And it comes on top of recent figures that show wages have grown faster than prices for seven months in a row, and growth is returning to the economy.
Our plan is working but we need to stick to it and see it right the way through.
Chancellor Jeremy Hunt says the government’s plan is working but the country needs to stick to it
Inflation is down to 3.4 per cent from over 11 per cent in October 2022, is a clear sign the economy is turning a corner (Pictured: The Bank of England)
With the progress we’ve made so far, we’ve been able to cut taxes by £900 a year for a typical worker on £35,400.
That means the average earner in the UK now has the lowest effective personal tax rate since 1975 – and one that is lower than in America, France, Germany or any G7 country.
And our reason for focusing on cutting National Insurance is simple: it’s a double tax on work.
Right now, if you are working, what you earn is taxed twice – through both National Insurance contributions and income tax. But if you get income from other sources you pay tax only once.
That’s what needs to end – and we’ll do so without borrowing more or cutting funding for public services.
We’ll do it responsibly, as proven by the steps we’ve already taken to cut taxes for 29 million people.
That’s the path we’re on as our economy gets better – and that’s the plan we need to stick to.
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