Hidden 1p tax in Budget could cost workers £448 a year in commutes

A hidden ‘1p tax’ will cost workers £448 a YEAR in commutes after the Labour Party Budget, it is feared. Birmingham commuters and those who travel by bus will be hit by a “bus tax” that is as costly as a 1p rise in income tax, new analysis shows.

A typical bus user will have to fork out an extra £448 a year as a result of the Government's decision to scrap the £2 fare cap. Liberal Democrats environment spokesperson Tim Farron blasted the move from Sir Keir Starmer and Chancellor Rachel Reeves.

Mr Farron said: “The government’s bus tax will clobber people across the country, especially those in rural areas and on low incomes. It is the last thing these people need after years of the Conservatives' economic vandalism. Keir Starmer’s decision is totally flawed.

READ MORE Martin Lewis addresses university tuition fee hike and says 'to be really clear'

"It makes travelling more expensive for working people and will make congestion worse across the country. While the new government faces tough decisions, it is unfair to place the burden of fixing the Conservatives’ mistakes on bus users and commuters."

Starmer last week stressed the cash for the £2 cap will dry up by the end of 2024. “On the £2 bus fare, first thing to say is the Tories only funded that until the end of 2024 and therefore that is the end of the funding in relation to a £2 capped fare," the Prime Minister said.

“I do know how much this matters, particularly in rural communities where there’s heavy reliance on buses. And that’s why I’m able to say to you this morning that in the Budget we will announce there will be a £3 cap on busfares to the end of 2025 because I know how important it is.”

A Government source said keeping fares capped was “hard fought for in the Budget”.