THE UK is in the full grips of a cost of living crisis. Everything from food prices to energy bills are skyrocketing.
The start of next month is set to see major price rises taking place, so here’s everything that will be rising in price come April 1.
Energy bills
Perhaps the biggest squeeze on Scots’ budgets this year will be the massive hike in gas and electricity prices. They’re set to increase by an average of 54% across the UK, meaning the average person will see their bills £693 more expensive than last year.
If you’re worried about energy bills,the Citizens Advice network is here to help.
— Citizens Advice Scotland (@CitAdviceScot) February 10, 2022
Find out more at https://t.co/ZFJ9YjfIpz https://t.co/Oe8Eq79WMv
And because the price cap is changed every six months, that means it is also likely to rise substantially again in September.
READ MORE: Cost of living crisis: The National wants to hear from people in Scotland struggling
As a result of the price hikes, people across the UK are being urged to do a metre reading on March 31 to ensure any prior usage is based on the previous, and cheaper price of energy.
To help, Chancellor Rishi Sunak announced all households will be given £200 off their energy bills. The policy is effectively a loan, as everyone will have to pay it back from 2023. That means an extra £40 will have to be paid back yearly for five years.
Council tax
The Scottish Government previously announced that the freeze on council tax rises would end, meaning local authorities could choose whether to increase tax.
Most Scottish councils opted to up their tax collections, with 22 out of the 32 local authorities increasing council tax by 3%.
Two local authorities went beyond that, with East Renfrewshire and Falkirk increasing their rate by 3.5% and 4% respectively.
Those living in Shetland will have their budgets spared, with the council opting to freeze its tax rate.
South Ayrshire, South Lanarkshire, Perth and Kinross, Midlothian, Dundee and Angus all chose a slightly lower than 3% rise while Inverclyde went for an increase of 1.95%.
However, this rise will be offset by the £150 council tax rebate for those in bands A-D, introduced by the UK and Scottish Governments. This will see the amount taken off people’s tax bills, with councils urging tenants and homeowners to set up a direct debit to ensure they receive the rebate on time.
Minimum Wage
A much-welcomed rise will be that of the national minimum wage, which means all ages will benefit from a pay increase.
Those aged more than 23 will see their minimum wage increase to £9.50 come Friday, up from £8.91 – a 6.6% increase equal to an extra £1074 a year.
Those agreed 21-22 will see a rise from £8.36 to £9.18 an hour while the apprentice rate will increase slightly from £4.30 to £4.81 an hour.
State pensions and benefit
Benefit claimants and those on the state pension will also see their pay rise by 3.1% from April 6. The UK Government has seen criticism as the cost of living is likely to rise by 10%, far exceeding this increase.
Benefits increasing include those on Universal Credit, Personal Independence Payment and Jobseeker's Allowance.
National Insurance
National Insurance rates will rise by 1.25% points but finance expert Martin Lewis has noted that for most people this equates to a jump of more than 10%.
For employees, they would previously pay 12% on earnings up to £50,270 and 2% on anything above that. From April 6, the rate goes up to 13.25% and 3.25% respectively.
For the self-employed, rates will go up from 9% and 2% to 10.25% and 3.25%.
I asked @hmtreasury to change misleading https://t.co/VZqFz6HC6z info about the NI rise 'increasing 1.25%'. It's not.
— Martin Lewis (@MartinSLewis) February 4, 2022
For most it's increasing from 12% to 13.25% - a 10.4% increase or a rise of 1.25% points.
Pleased to say its listened & changed it
New on left. Old on right pic.twitter.com/Ty5ads3QrM
After heavy criticism from opposition parties, the Chancellor also announced an increase to the National insurance threshold from July. This means you won’t pay any National Insurance on earnings below £12,570 per year, up from £9,568.
This means most people (around 70%) earning less than £35,000 will pay slightly less National Insurance.
Vat
The cost of buying a pub meal, soft drink or hotel stay could become more expensive from April as VAT levels across the hospitality sector lift back to 20%.
The industry saw VAT drop to 5% to support its recovery during the pandemic.
It rebounded back to 12.5% in October last year as restrictions eased, but it is now due to rise again to 20% on Friday.
Despite the initial fall in tax, few pub groups, restaurants and leisure businesses were able to pass on the benefits of the tax break – which covered soft drinks, food, events tickets, accommodation and other areas – to customers due to the financial impact of the pandemic.
Bosses said that lengthy Covid disruption, significant debts and soaring cost inflation in recent months mean the reduced tax level has been used to help absorb costs.
However, industry chiefs, including Wetherspoon founder Tim Martin and Young’s boss Patrick Dardis, said prices would now have to increase significantly for customers as a result of reduced VAT support.
Leaders warned the Government that the VAT increase would contribute to a “cliff-edge” on Friday as wages and business rate changes also come into force.
Emma McClarkin, chief executive of the British Beer and Pub Association (BBPA), said the VAT rate increase alone is expected to cost UK pubs more than £500 million over the next year.
READ MORE: What Scotland can do to avoid rising energy, food and house prices
UKHospitality boss Kate Nicholls said it “might prove fatal” for business owners.
Houses
The price of a house in the UK has been quickly rising, and in the first quarter of 2022 they jumped by 12% in Scotland to an average of £178,289. This is the biggest jump in price for Scotland since 2007.
While house prices aren’t set measures like other bills in this list, they have been rising consistently and are likely to continue to.
Stamps
From April 4, first and second class stamps will cost a little bit more. First-class stamps will go up by 10p to 95p while second class stamps will see a smaller 2p rise to 68p.
Those who buy a lot of stamps may want to bulk buy before the price hike comes into place.
How is the cost of living crisis affecting you?
From soaring energy bills to rising food prices and stagnating wages, it's getting harder and harder for many Scots to make ends meet. We want to tell the stories of how the cost of living crisis is impacting people in Scotland. Are you struggling to choose between heating and eating? Are you finding it increasingly difficult to afford your weekly shop? If so, we want to go beyond the statistics and tell your story.
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