New polling has found more than half (57%) of households think the Budget will leave them financially worse-off - and 80% would possibly support some further tax rises if necessary.
Around a third of respondents (32%) said it will have no noticeable impact and just one-in-ten (10%) felt it will leave them better-off, according to the results analysed by University of Bristol researchers and commissioned by abrdn Financial Fairness Trust.
But households were twice as likely to say the tax rises announced in the Budget were necessary (48%) than unnecessary (24%) for improving public services. Even among those who expect to be personally worse-off from the Budget, 41% see the tax rises as necessary, compared with a third (32%) who see them as unnecessary.
Professor Sharon Collard, Chair in Personal Finance at the University of Bristol, said: "While our data suggests that the public are rarely enthusiastic about increased taxes (and would generally prefer them to be paid by someone else), it does show that there is some awareness of the need for investment in public services and the trade-offs inherent in policymaking. Those in positions of power should continue to explore ways to better communicate the complexities of decisions that are taken."
The Impact of the Budget report questioned around 5,800 households on how they felt the Budget would affect their household finances. Researchers also asked how people would feel about future tax rises if they were necessary to improve public services. Overall, 80% of respondents showed some willingness to support at least one of nine potential taxes asked about, with around half (47%) being in favour of three or more of the taxes.
Among those who felt the Budget would leave them worse-off, there was a wide gulf between different age groups. Only 36% of under 30s felt they would be worse-off, whereas more than double the number of over 70s (76%) felt they would be worse-off.
Lower income households were also more likely to believe that the Budget would leave them worse-off. 62% of those on the lowest incomes (the bottom quintile) felt the Budget would leave them worse-off, whereas 44% of those in the highest income quintile felt they would be worse-off.
Of the Government's current tax policies asked about, eight out of ten enjoyed more support than opposition. The rise in employer National Insurance (NI) contributions and changes to inheritance tax rules were the only two policies with higher levels of opposition than support (-9% and -22% net support respectively). Leaving VAT, income tax and employee NI unchanged was the most popular measure (52% net support), followed by taxes on tobacco and vaping (49%), which actually had the highest proportion of respondents saying they 'strongly support' it (41%). The decisions to cancel the rise in fuel duty and increase Employment Allowance (which allows smaller businesses to reduce the amount of NI they pay) were also well supported (47% and 43% net support respectively). There was also support for VAT on private education (net 29% support), holding corporation tax steady (13%), changes to capital gains taxes (9%), and taxing less efficient new vehicles (2%).
Researchers also asked respondents about the extent to which they might support various further tax rises in the future if necessary to improve public services [see notes for a full list of potential tax rises]. Four of the nine policies asked about had more support than opposition, while five had more opposition than support. Respondents were most positive about further taxes on tobacco, vaping, alcohol, unhealthy foods and gambling (59% support vs 18% opposition), followed by taxes on wealth (53% support vs 18% opposition). People were most opposed to further rises in council tax (or rates in Northern Ireland) (59% oppose vs 12% support) and taxes on general spending, such as VAT (54% oppose vs 14% support).
Mubin Haq, CEO of abrdn Financial Fairness Trust, said: "People are willing to pay more in tax if that means improvements to public services. They recognise that our schools, hospitals and other essential services are under huge strain and in need of investment. Whilst for some this is a bitter pill to swallow, the public are supportive of government increasing taxes, even if it means they personally feel worse-off. We also find there is appetite for further tax increases if further investment is needed, but it will be essential for the government to show public services are improving and they are on the right track."
Paper
'Impact of the Budget: Public perceptions of the financial impacts of the 2024 Autumn Budget' by J. Evans, K. Cross and S. Collard
