Dai Havard

Labour Party | Merthyr Tydfil & Rhymney

TAX CHANGES – MAJOR IMPROVEMENTS AND WORK IN PROGRESS

Raising personal tax allowances by £600 takes 600,000 people on low incomes out of paying tax and benefits for all standard rate tax payers. Raising allowances in this way is needed to compensate those affected by the 10p tax rate. It is also needed to help others as the economy goes through an increasingly difficult period which is forcing increases in commodity prices. 80% of those affected by the 10p rate change will now effectively get full compensation for this tax year. Raising tax thresholds to do that is exactly what I have been arguing for. Even with these changes at present 20% of those affected by the 10p tax change will, only get half the compensation they need for the whole year. I would have liked the personal the tax threshold to go up more to deal with all those affected at the same time, but these changes go most of the way and I am still pressing to get that resolved. MP’s will again have the chance to press the issue further next month and we look to more changes in the Pre-Budget statement in the autumn. These new tax threshold changes for standard rate tax payers, when combined with increasing allowances for over 65’s, raising the Working Tax Credit and Child Tax Credit, as well as Child Benefit and an additional £50 Winter Fuel Payment for over 60’s; are major improvements. Asking the Low Pay Commission to consider younger workers to get the Minimum Wage improved for them is also important. Whilst we have made significant progress I will be continuing to press all of these issues. For further information please see the website www.hmrc.gov.uk or contact the Citizens Advice Bureaux.