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The interaction of the National Minimum Wage with the tax and benefit system
Funded by: Low Pay Commission
Date started: 14 April 2009

This project uses the Labour Force Survey, the Family Resources Survey and TAXBEN, the IFS's tax and benefit simulation model to analyse the interaction of the National Minimum Wage (NMW) with the tax and benefit system. In particular it includes an analysis of the position of families with NMW recipients in the working-age income distribution and the marginal effective tax rates and participation tax rates these workers face, compared to other wokers. The impact of a 10% increase in the NMW on family income is also simulated.

The main analysis is based upon the 2007-08 tax and benefit system and we also investigate how changes in the tax and benefit system affected/will affect NMW recipients and their families.

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01 October 2009
External publications
Article
This paper makes use of the Family Resources Survey and the Labour Force Survey. It is the final report for a project commissioned by the Low Pay Commission.

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