Nick Clegg urges swifter tax cuts
Nick Clegg is to throw his weight behind a move to speed up the promised tax cuts the government is making for lower bracket earners.
Currently the personal tax allowance – the initial chunk of your wage that you don’t have to pay any tax on – stands at £7,475. That has been raised £1,000 since last year.
The coalition government plans to increase the allowance further, up to £10,000, so anyone earning that amount or less won’t have to pay a penny of tax.
However, the increase is planned in gradual increments with the £10,000 figure being reached in 2015.
While the increase in personal allowance gives everyone a tax saving, higher earners will foot the cost via new levies imposed on them.
However, Nick Clegg believes that the 2015 date is too sluggish a timetable for the tax burden being eased on lower-to-middle incomes. Particularly with the rate household debt is accumulating in the UK due to inflation and the rising cost of living, along with lack of wage increases.
The Telegraph reported Clegg as stating: “I want the Coalition to go further and faster in delivering the full £10,000 allowance, because the pressure on family finances is reaching boiling point.”
“There is now an urgent need to give families more help; an urgent need to rebalance our tax system so it rewards work and encourages ordinary people to drive growth.”
He also underlined a need to close loopholes in the tax system – the usual offshore shenanigans and other avoidance avenues – which the wealthy and ultra-rich employ to dodge paying tax. And whopping amounts of tax in those cases, of course.
Apparently it isn’t likely that this year’s rise in the allowance will be modified, which will see the amount hit £8,000, but next year’s jump could be increased to perhaps a full £1,000 rise. Clegg might well argue it should go up even further than that next year.
Category: All Financial News, Tax News
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