They hit you hardest if your income is close to one of the tax thresholds, but anyone who gets a pay rise is affected, as long as you earn enough to pay tax. Only people earning under £12,570 – the personal allowance threshold – pay no income tax.
By 2031 an extra 6.8 million people will be paying tax who wouldn’t have if the personal allowance had not been frozen, the OBR calculates.
The state pension is currently just below the personal allowance threshold, and pensioners looked set to be drawn into paying tax from next April, when the basic state pension rises to £13,036.
However, the chancellor is putting in place a new separate Pension Tax Allowance, which will ensure that low-income pensioners, with income up to the value of the full new state pension, will not pay income tax.
The personal allowance threshold is set for the whole UK, so people in Scotland will also be affected, although other tax bands there vary, external.
National Insurance Contributions (Nics) are levied according to the same thresholds.