A RAFT of measures – including increased tax breaks, social security cuts and benefit hikes – designed to help Islanders tackle the cost-of-living crisis has been approved by the States.
Last month, the Council of Ministers unveiled their emergency mini-budget as the Island faces the biggest rise in inflation for more than three decades as spiralling food, energy and housing costs put increased pressure on Islanders.
Tax thresholds will now increase by 12%, including child allowances, additional allowances and child care tax relief. This should mean that a single person on the marginal rate would be £520 better off next year, while a married couple with two children earning around £50,000 will take home around £1,243 more.
Social security contributions will drop by 2% from October meaning that class 1 employee contributions will drop from 6% to 4% while class 2 contributions – for self-employed and unemployed Islanders – will drop from 12.5% to 10.5%.
It is estimated that this will benefit around 54,000 people.
And old-age pensions will increase by 7.7% in October in line with inflation, while a £600,000 scheme to provide free period products between now and the end of next year is also being planned.
The Cost of Living Temporary Scheme, which runs until the end of the year and provides £20 per person per month for households on income support, which equates to an extra £80 for two adults and two children, has been doubled with immediate effect, meaning a family of four will now have an additional £160.
There will also be an extra rise in income support in January to match September’s inflation rate while cold-weather payments will rise to £70 per month from October 2022 to March 2023 and will not be dependent on temperatures, as they currently are.
The mini-budget was approved by 46 votes to none.
