The Liberal Democrats are delivering a £700 Income Tax cut for 24.5m working people – a year ahead of schedule.
The announcement that the Income Tax Personal Allowance will rise to £10,000, confirmed in the Budget, means the Liberal Democrats’ top priority at the 2010 General Election has been delivered in full by the Coalition Government. It means:
- A £700 tax cut for 24.5m working people across the UK since the Liberal Democrats came to power.
- 2.7m low paid workers will no longer pay Income Tax at all.
- For the average family, we have cut the Income Tax bill by a third.
- It is enough for a working couple to pay their council tax or combined gas and electricity bills for a year.
- The Coalition commitment to raise the threshold to £10,000 by 2015 will be achieved a year early, in April 2014.
Letting you keep more of the money you earn is a key part of our plan to build a stronger economy in a fairer society, enabling everyone to get on in life.
The £700 tax cut comes alongside more help for working families in the Budget, which confirmed a freeze in fuel duty and £1,200 off the cost of childcare for every child.
Commenting, Liberal Democrat Chief Secretary to the Treasury Danny Alexander said: “When times are as tough as they are now, our focus must be on helping those on low and middle incomes. That’s why we’ve made delivering on this promise our number one priority in Government.
“It’s also why we have scrapped another of Labour’s fuel duty rises, so filling up your car will be £7 cheaper than under Labour plans. And why we are cracking down on tax dodgers so that everyone is paying their fair share.
“All of this has been done while sticking to our tough but necessary plan to deal with this country’s financial problems. Britain can’t afford unfunded giveaways – unlike the last Labour government, we have made sure everything is paid for.
“The success of the Liberal Democrats in delivering fairer taxes is in stark contrast to record of the Labour Party. In Government, Labour increased tax on low income households; in Government the Liberal Democrats have led the largest programme of tax cuts for working people for a generation.
“I'd like us to go further after the election - with the goal that you don't pay Income Tax until you earn more than the minimum wage. That is the sign of a fair tax party. Today we should celebrate the fact that this Budget is getting real help to millions of working people at a time when they need it most.”
While today’s announced rise in the Personal Allowance to £10,000 comes into effect next year, people on low and middle incomes will see more money in their pay packets next month. This April sees the biggest ever rise in the Personal Allowance – to £9,440. That’s a £600 tax cut for working people since the Liberal Democrats came to power, with more to come next year.