Tax cuts expected to be announced in today's pre-Budget report will not boost spending as planned, it has been suggested.
Research by Axa has found that just 22 per cent of people would increase high street spending if taxes are cut by £60 per month.
Chancellor of the exchequer Alistair Darling is expected to announce the move later today in a bid to encourage a revival of the economy.
But the firm has revealed that people will use it in other ways, with a third planning to use it to pay off secured and unsecured loans.
"Worries about the state of the economy and job security in 2009 would lead many Britons to take advantage of a tax cut by shoring up their finances, reducing their debts or increasing savings," said spokesman Steve Folkard.
Last week online education company Whizz.com noted that people are finding themselves in financial difficulty because they do not understand the mathematics of loans and interest.
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