10p Tax Rate Will Continue

10p Tax Rate Will Continue

The Government has committed to extending its £2.7bn 10p tax compensation package to future years.  The Institute for Fiscal Studies called on the Government to extend its “one-off income tax cut” after it calculated that 18 million families would be worse off by an average of over £150 a year as a result of tax and benefit changes over the next two years.

In May, the Chancellor set out a £2.7bn package to compensate some of the 5.3 million people affected by the abolition of the 10p tax rate.  It involves increasing personal allowances.  But the Government was slammed for not confirming whether the support would extend to future years.  But the Treasury confirmed to leading financial industry newspaper Money Marking that low-earners would receive similar support in future.  

Our view

A shameful debacle and u-turn.  The government continues to rape people’s pockets everyday with stealth taxes and does little to reduce its costs for central or local government or social services benefits payments.

Useful links:

Learn more about Slashing Your Tax and related topics in the Income Tax Adviser Channel

Request expert financial advice now

Purchase guidance on financial planning in the Money Shop 

Back to News Summary