Blow for Burnham as poll shows three in four voters say flagship VAT cut won’t help them pay the bills

Blow for Burnham as poll shows three in four voters say flagship VAT cut won’t help them pay the bills Survey found much more support for another policy Mr Burnham has talked about but warned would be expensive - raising the tax-free personal allowance - Bookmark - CommentsGo to comments Nearly three-quarters of Britons believe Andy Burnham’s decision to scrap VAT on household electricity bills will do little to ease the cost of living crisis, according to a new poll. The findings will come as a setback for the Labour leader, who has argued the measure – his first major policy as prime minister – will put more money in people’s pockets and “bring back hope”. Announced with great fanfare on his second day in the job, the £850m tax cut will make electricity bills VAT-free from the start of October, saving households around £45 a year. However, a survey by pollsters Opinium found 72 per cent of adults think the policy will make little or no difference to their household finances. Young people were most optimistic about the measure, with 39 per cent saying it would help. That fell to 24 per cent among 35 to 49-year-olds and just 6 per cent among the over-50s. The poll also found much stronger support for another measure Mr Burnham has talked about, with more than half of those asked, 52 per cent, saying they thought unfreezing the tax-free personal allowance and raising it in line with inflation would leave them better off. Mr Burnham has not ruled out increasing the allowance in his government’s first Budget in October, but he has warned that any change would be expensive and "difficult given the financial circumstances in which we find ourselves". It has been frozen at £12,570 for the last five years, leaving more and more people pulled into paying income tax as inflation pushes up wages. The highly-respected Institute for Fiscal Studies think tank has estimated that unfreezing the threshold could end up costing between £8.5 and 9bn a year. Matthew Howlett, research manager at Opinium, said: “Most people don’t expect Burnham’s first major economic announcement to make much difference to the cost-of-living. “As the new prime minister and chancellor look ahead to their first Budget in October, a majority of voters think that unfreezing the tax-free personal allowance would have a significant impact on their finances.” The poll of 2,050 UK adults was carried out between 29 and 31 July. Mr Burnham has told his cabinet he wants to lead a "cost of living government", and that to make that happen, ministers should be "prepared to reprioritise" how they allocate their budgets. Unveiling the VAT cut, he said he “wanted to give people breathing space, and that’s what I’m announcing… We’re taking immediate action to cut taxes on energy bills, put more money in people’s pockets and bring back hope.” Ministers have said that energy suppliers will be expected to pass the VAT reduction on to all customers, including those on fixed tariffs. Join our commenting forum Join thought-provoking conversations, follow other Independent readers and see their replies Comments