Local MP Jo Swinson has hailed the 6 April Income Tax cut as a giant leap towards the Liberal Democrat goal of a fairer tax system.
On 6 April 2013, the Personal Allowance will be raised to £9,440 – the largest rise in the Personal Allowance ever. This means that 43,300 ordinary basic rate taxpayers in East Dunbartonshire will see their Income Tax cut for the third year in a row. That will bring the total Income Tax cut since Labour’s time in government to £600.
Thanks to this rise in the point at which you start to pay Income Tax, the number of the lowest paid people who have been lifted out of paying any Income Tax will reach 3000.
Commenting, Jo said:
“This Income Tax cut is real help for ordinary people in these difficult times. It is evidence of how in the Coalition Government, the Liberal Democrat priority is to create a fairer society and a stronger economy, enabling everyone to get on in life.
“Labour increased taxes for lower paid workers by doubling the 10p tax rate and now stand on the side-lines denying their responsibility for the economic mess they created. It shows people still can’t trust them to make the right decisions on the economy.
“At the same time, we know that you can’t trust the Tories to deliver a fairer society. It is thanks to Liberal Democrats that 24m basic rate taxpayers are getting an Income Tax cut on 6 April. At the same time, Liberal Democrats in the Coalition are cracking down on tax avoidance and ensuring the wealthy pay their fair share.
“That we Liberal Democrats are working hard in East Dunbartonshire to deliver both a stronger economy and a fairer society is clear too. Getting people into work locally is a priority and thanks to my Get East Dunbartonshire Working initiative more than 100 work and training opportunities were created in the area.”
The Personal Allowance, also known as the Income Tax threshold, will rise to £9,440 on 6 April 2013, up from £6,475 under Labour. It will rise to £10,000 in April 2014.
In the early 1970s, the Personal Allowance was worth around 28% of average earnings. By 2010 that had dropped to around 20% as wages had outpaced the increase in the Allowance.
Other measures coming into effect this April are:
1 April: Mansion Tax for tax dodgers: From April 1st, those who wrap up their properties in companies to avoid tax will have to pay a Mansion Tax of up to £140,000 every year and they will now have to pay 28% Capital Gains Tax on any profits when they are sold. Labour’s tax dodgers’ charter allowed multi-millionaires to use complex tax wheezes to buy expensive properties and avoid paying their fair share of tax. The Coalition has already introduced a 15% stamp duty on the purchase of homes worth over £2m by certain companies.
1 April: Private Jet Levy: Liberal Democrats want to ensure that pollution for flying is properly taxed. But under Labour’s rules, families going away on their holidays paid more tax for flying than millionaires using their private jets. From April 1st, Air Passenger Duty has been extended to private jets and smaller aircraft. A new higher rate of tax will also be payable on flights aboard luxury aircrafts of 20 tonnes and above with fewer than 19 seats.
6 April: Tycoon Tax: We are stopping the wealthiest people in society from exploiting Labour’s tax loopholes by introducing a tycoon tax to put a cap on previously unlimited income tax reliefs. Tax reliefs exist for good reasons, to promote activities such as business and investment. But it is unfair that reliefs can be used without limit to reduce tax liabilities, so that some taxpayers with very high incomes have very low tax rates. Individuals will be limited to the greater of £50,000 or 25 per cent of their income in tax relief. Tax relief on charitable donations will be exempt.
8 April: State Pension “Triple Lock”: the full basic State Pension will increase by 2.5%, or £2.70 a week, to £110.15 per week. In April 2012, the triple lock ensured pensioners benefited from the largest ever increase to the basic State Pension of £5.30 per week. Now the basic State Pension represents a higher share of average earnings than at any time since 1992.