As inflation roars on uncontrolled and is predicted to hit 18per cent by early 2023, research published this week suggests that the average person needs a pay rise of at least £3,500 just to keep up.
And that’s to keep up with an inflation rate of around 9per cent – half of what seems to be coming our way in the cost of living crisis created under the shambles of the AWOL government of Boris Johnson and his Tory mates.
Research by RIFT Tax Refunds has revealed just how much the average person would need to see their pay cheque increase by in order to keep up with inflation and what it means when it comes to the tax they pay and the money left in their pocket.
The average gross salary in this country is currently £37,235.
But figures released this month by the Office for National Statistics showed inflation at its highest rate since December 1990, with the Consumer Price Index at 10.1per cent in July.
In order to match even the current rate of inflation, the average person would need a pay rise of £3,500. While this would see their tax bill increase by £1,164 per year, it would also leave them with an additional £2,336.
RIFT’s researchers provide a number of examples.
The average beautician would need to see a £1,461 increase in their annual gross earnings in order to keep pace with the current rate of inflation, paying £486 more in tax contributions but taking home £975 more per year.
Those working in construction would need to see a pay rise of £3,074, boosting their annual net income by £2,053, while increasing their tax bill by £1,022 per year.
The average nurse would need to take home an additional £3,138 per year which would increase their net income by £2,095 annually while seeing them pay £1,043 per year.
The average teacher also needs to earn £3,331 more than the current average earnings in order to battle the impact of inflation, seeing them take home an additional £2,223 after tax and paying £1,107 more in tax contributions.
Bradley Post, the CEO of RIFT Tax Refunds, said, “Many households are struggling to combat the increased cost of living due to the current rate of inflation, with many attempting to do so on a stagnant level of income that hasn’t seen the same level of growth.
“In fact, in order to match this pace, the average person would need to see quite a considerable boost to their annual earnings to the tune of £3,500.
“However, the unfortunate reality is that many simply won’t and this will leave them at a severe disadvantage when it comes to managing their household finances.”
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