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Tuesday, 2nd December 2008

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Government wrong on 10p tax



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Published Date: 24 April 2008
AT A MEETING of Labour MPs last December I told the Prime Minister that there would be a political price to pay for the abolition of the 10p income tax rate.
So it has proven: my postbag reflects concerns from many more people than are directly affected by it.

Initially we thought that women, aged 61-64 and on low incomes, would be the only ones to see their income fall as a direct result of the tax changes in the Budget.

This is because, for most people, the fall in income tax from 22p to 20p more than compensates for the loss of the 10p band.

But, at a time when fuel and food costs are rising (for reasons outside the government's control) why are we reducing the income of anyone on low pay?

Tax credits have risen by more than inflation and this helps families with low income.

But I know of constituents without families, on roughly the minimum wage, who lose £150 a year or £3 a week as the 10p band is lost.

The 10p band was a popular measure. It reduced income tax for everyone but helped those on the lowest incomes especially.

I have heard no criticism of it and I was surprised when its abolition was announced last year.

This week the Budget's tax changes will be felt in people's pay packets. I do not expect the Chancellor to make a U-turn so soon after the Budget.

Nevertheless, I shall tell him that High Peak people expect more measures to help people on the lowest incomes, who have lost out on the 10p abolition, pretty soon.

I am a strong supporter of this government and especially of our fight against poverty. Yet we cannot afford to make mistakes.

On the 10p issue it gives me no pleasure to say "I told you so".

The full article contains 316 words and appears in Buxton Advertiser newspaper.
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  • Last Updated: 23 April 2008 3:04 PM
  • Source: Buxton Advertiser
  • Location: Buxton
 
 

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