State pensioners: Keir Starmer and Reeves plot cruel tax | Personal Finance | Finance
Over four million pensioners could face a new tax hit, as Labour leader Sir Keir Starmer has refused to rule out scrapping key benefits, including the single-person council tax discount. This potential move comes after Labour’s controversial decision to abolish the Winter Fuel Allowance, sparking widespread concern among retirees.
Abolishing the 25 percent council tax discount, which is currently available to single-person households, would primarily impact state pensioners, who reportedly make up nearly half of the 8.4 million people benefiting from it.
If the discount is removed, pensioners living in the average council tax Band D could see their bills rise by around £543 per year. The Institute for Fiscal Studies estimates that scrapping the discount would save the Government £3billion annually.
The Telegraph reports that pensioners fear the removal of this benefit would be an “unforgivable betrayal” and could even force some to lose their homes. The council tax discount is seen as crucial support for single-person pensioner households struggling with rising living costs.
When challenged by Tory MP Louie French about the discount during a heated session in parliament, Sir Kir responded: “I am not going to pre-empt the Budget. It will all be set out in due course.”
Meanwhile, Chancellor Rachel Reeves hinted that the upcoming Budget would require “difficult decisions on tax, spending, and welfare,” further fuelling concerns about potential cuts to benefits.
Despite assurances from Downing Street that there are no plans to remove free bus passes for pensioners, there has been no clear commitment regarding the future of the council tax discount.
Labour is also under fire for not publishing an impact assessment on the effects of abolishing the Winter Fuel Allowance, which will see millions of pensioners lose up to £300 per year.
Labour’s ongoing efforts to stabilise the economy are cited as the reason for these cuts, with Sir Keir defending the decisions by emphasising their commitment to maintaining the state pension triple lock.
However, pensioners and campaigners argue that removing these essential benefits will leave many vulnerable, especially those not eligible for other forms of support such as Pension Credit.
The Chancellor will unveil the Autumn Budget on October 30, 2024.
