Middle class families are facing a staggering £8,000 increase in their tax bills in 2025, according to new analysis.
The looming tax raid comes as households brace for multiple increases across various areas, from children’s education to council tax.
Labour’s tax policies are set to come into force next year, hitting families through multiple channels.
With Chancellor Rachel Reeves already having increased taxes by £40bn in her maiden Budget, and refusing to rule out further raids, millions of families are heading towards what critics are calling a “January of discontent”.
Last night the Institute for Fiscal Studies (IFS) warned that with the tax burden “rising to levels that we haven’t previously seen in this country” it is inevitable that families will feel under pressure.
Hundreds of thousands of children could be pulled out of private schools under Labour’s 20% tax plan, research suggests GETTYA middle-class family with one child in private education would face an additional £7,730 in taxation next year, according to analysis from The Telegraph.
The analysis is based on a typical middle-class household with two adults each earning £55,910, representing the average wage of those in the top 20 per cent of earners, according to the Office for National Statistics.
The breakdown includes a £3,520 hit from ongoing tax threshold freezes. A further £1,410 will come from increased employer national insurance, with the Office for Budget Responsibility indicating 60 per cent of this cost will be passed to workers and consumers.
Private school fees will rise by £2,626 following the VAT raid. Households will also face a £14.50 increase in shopping bills due to the “grocery tax”. Council tax is also expected to rise by £159.
Andrew Griffith, the shadow business secretary, has condemned the scale of the tax increases as “completely unacceptable”.
He warned the measures show the Government is “completely out of touch with middle Britain”.
“This level of tax raid fails to understand what it’s like to try and bring up a family to a reasonable standard,” he said.
Griffith described it as “one of the biggest transfers from the aspirant class to the public sector that anyone has ever seen”.
He said: “We are heading for a January of discontent. The best New Year present that Rachel Reeves could give is to change and change tack quickly.”
A family on an average income of £37,340 per adult will be hit with £2,529 of extra taxes in 2025.
Carl Emmerson, the deputy director of the Institute for Fiscal Studies, said: “With the UK tax burden rising to levels that we haven’t previously seen in this country it is no surprise that people will feel squeezed.
“What remains to be seen is how well they feel the money is being spent and how much those households benefit from any improvement in public services.”
Such households will be particularly impacted by the combination of tax threshold freezes, increased national insurance contributions, and additional costs related to education and daily expenses.
A Treasury spokesman said: “We know that many families are feeling the pinch, which is why we protected payslips from higher taxes as well as higher VAT, gave a pay rise to three million workers next year, kept prices down at the pumps by freezing fuel duty, and are not extending the freeze on personal tax thresholds past 2027/28.
“Now we have wiped the slate clean, our Plan for Change is focused on delivering growth that people will feel the impact of, with figures this month showing that wages after inflation have grown at the fastest rate in three years since the election worth an extra £20 a week after inflation.”
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