NICK CLEGG has vowed to slash the tax of around 30 million workers in 2016 should they be re-elected at the polls.
The Liberal Democrat leader said his party would raise the 20% rate threshold to the first £11,000 of income in the first year of the next parliament. He also suggested that workers’ National Insurance rates would be move up, in time, to match those of income tax.
The increase – worth £500 to each taxpayer – would be paid for by tax rises on wealthier individuals and not hit low-earners in what he dubbed a “fair way of funding tax breaks”.
And he took a swipe at David Cameron accusing him of hijacking the LibDem’s long-term goal of raising the personal allowance still further – to £12,500 – by 2020.
The Sheffield Hallam MP made his announcement as party members descended on Glasgow for the LibDem conference.
It is already coalition policy to lift the personal tax allowance to £10,500 from April 2015.
Just last week the prime minister announced that a future Conservative government planned to raise the income tax bar to £12,500 by the end of the next Parliament.
However this would only be enacted when it was deemed prudent to do so and not before the budget deficit had been eliminated, expected to be by around 2018.
Clegg’s move would be funded by raising the level of capital gains tax paid by the wealthier tiers of society and ensuring more funds are clawed back from corporate tax avoidance.
Capital gains tax is currently 28%, having been raised by 10% in 2010, but is based on an individual’s earnings.
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