TaxPersonal TaxFuture Lib Dem leader slammed over tax plans

Future Lib Dem leader slammed over tax plans

Economic think tank says Chris Huhne’s income tax plans will cost country £21bn

Plans by Chris Huhne, the front-runner to become the next leader of the
Liberal Democrats, to exclude people on the £5.05-an-hour minimum wage from
paying income tax would cost the country £21bn, The Institute for Fiscal Studies
has calculated.

The IFS said Huhne’s tax plans would lead to an increase in income tax
equivalent to 5.5p in the pound, The Times reported.

Stuart Adam, a senior research economist at the institute, said: ‘As a first
approximation, this income tax cut would cost roughly £21bn, some 1.7% of
national income or 4.2% of the total revenue the Chancellor expects to receive
this year.

Huhne, who said the extra cost would be met by higher environmental taxes,
wrote in his manifesto: ‘It is crazy to say that people should have a minimum
wage then take it away in income tax.’

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