Yesterday (30 April) was pay day for millions of people across Britain, which means they received their first pay slip since the Income Tax personal allowance was raised from £8,105 to £9,440.
When Liberal Democrats came into power in 2010 this was just £6,475.
Raising the tax-free allowance is the Liberal Democrats’ flagship policy and has so far seen Income Tax bills slashed by £600 a year for millions of low and middle income workers compared to what they were paying under Labour. As a result, more than 2m people on low pay have been lifted out of paying Income Tax altogether.
The threshold will rise again next year to £10,000, fulfilling a commitment from the front page of the Liberal Democrats’ 2010 General Election manifesto and resulting in a total tax cut of £700.
Commenting Jo said:
“If you got paid yesterday, take a moment to compare your pay slip to last month’s. You’ll see that Liberal Democrats have cut your taxes.
“From this month, the Liberal Democrats will have lifted 2m people out of Income Tax and given a tax cut of £600 to more than 20m people.
“It has taken the Liberal Democrats being in Government to deliver the largest programme of tax cuts for working people for a generation.
“The Liberal Democrats are the only party that will radically cut taxes for people on low and middle incomes to build a stronger economy and a fairer society so that everyone can get on in life.”
Liberal Democrats in the Coalition Government have increased the amount of money you can earn tax-free every year. This month, the start of the new financial year, the tax-free allowance rose to £9,440. In April 2014 it will be raised to £10,000, a total tax cut of £700 a year for nearly 25m people.
In 2014, someone working full-time on the minimum wage will see their Income Tax bill cut by almost two thirds compared to what they were paying under Labour.
By April 2014 we will have taken 2.7m low-income workers out of paying tax altogether, the majority of whom will be women.
The £700 tax cut means, 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.
Beyond this unprecedented rise in the Personal Allowance, we want to increase the tax-free allowance further until no one pays any Income Tax until they earn more than the National Minimum Wage.
Labour’s record of unfair taxes: Labour cut tax for millionaires every single year until their last month, while increasing tax on low earners by scrapping the 10p tax rate. Under Labour, someone on the Minimum Wage paid £1,000 in Income Tax. We have cut their tax bill by more than half and under our future plans, they would pay nothing.
For all but one month of Labour’s 13 years in power the top rate of tax was 40p. Top earners are paying more in tax every year under the Coalition Government.
Labour helped the richest in society when they cut Capital Gains Tax