Distributional effects

The long-term effects of in-work benefits in a life-cycle model for policy evaluation

This note provides details on the average losses among pensioner households from tax and benefit reforms that will be introduced between January 2011 and April 2014.

This Briefing Note analyses Universal Credit as set out in the government's White Paper, Universal Credit: Welfare that Works.

Immediately following the Spending Review of 20th October, the IFS updated its analysis of the distributional impact of tax and benefit reforms to be introduced between 2010-11 and 2014-15, taking into account the effects of the reforms announced in the Spending Review.2 This did not substantially alter the conclusions from previous analysis by IFS researchers that the impact of the tax and benefit reforms to be introduced over this period was decreasing as a proportion of income within the lowest 90% of households in the income distribution, although it is the very richest households that will lose the most overall. If we were instead to rank households by expenditure, which as we have argued previously might better reflect households' lifetime incomes, losses as a proportion of expenditure again fall as we move up the expenditure distribution

In this paper we look at how the tax and benefit system redistributed income and affected incentives to work in 2009-10, and at the effect of tax and benefit reforms between 1978-79 and 2009-10 on the level of inequality and work incentives.

IFS analysis shows that the coalition Government's tax increases and welfare cuts are hitting Londoners harder, on average, than households across the UK as a whole.

In this Briefing Note, we attempt to model the full impact of tax and benefit changes in the Budget, including additional benefit cuts, on different income and expenditure groups.

This note discusses the tax and benefit proposals of Labour, the Conservatives and the Liberal Democrats, looking at their economic and administrative merits, their distributional impact and their effect of incentives to work and save.