Thursday, April 19, 2012
Labour seek to reduce top rate of tax to 40p
Over at Liberal Democrat Voice, Caron Lindsay underlines Labour's confusion and incompetence over the UK Administration's budget, which they have labelled as one for millionaires.
She reminds us that Labour squealed long and loud about how wicked the Coalition is, particularly on cutting the 50p tax rate to 45p. However, when they had the chance to vote against it in March, as Ed Balls promised they would, not one of them did.
Now they have tabled an amendment which, if it had passed, would have set the top rate of tax at 40p:
Let me explain. The Finance Bill clauses put forward by the Government were as follows:
'Clause 1 – Income tax
Charge for 2012-13 and rates for 2012-13 and subsequent tax years
(1) Income tax is charged for the tax year 2012-13, and for that tax year.
(a) the basic rate is 20%,
(b) the higher rate is 40%, and
(c) the additional rate is 50%.
(2) For the tax year 2013-14.
(a) the basic rate is 20%,
(b) the higher rate is 40%, and
(c) the additional rate is 45%.'
The Labour amendment was to delete 2(c) which, if passed, would have left us with no additional rate.
As the Co-Chair of the Liberal Democrat Parliamentary Treasury Committee, Stephen Williams, says:
“Labour’s biggest tax change was to remove the 10p tax rate hitting people on low and middle incomes while Liberal Democrats are giving nearly 25m basic-rate tax payers an Income Tax cut and have lifted more than a million people out of paying Income Tax altogether. At the same time, we’re making the rich pay their fair share by cracking down on loopholes and excessive tax relief."
It seems that they are determined to compound that error by giving a bigger tax break than intended to the better off.
She reminds us that Labour squealed long and loud about how wicked the Coalition is, particularly on cutting the 50p tax rate to 45p. However, when they had the chance to vote against it in March, as Ed Balls promised they would, not one of them did.
Now they have tabled an amendment which, if it had passed, would have set the top rate of tax at 40p:
Let me explain. The Finance Bill clauses put forward by the Government were as follows:
'Clause 1 – Income tax
Charge for 2012-13 and rates for 2012-13 and subsequent tax years
(1) Income tax is charged for the tax year 2012-13, and for that tax year.
(a) the basic rate is 20%,
(b) the higher rate is 40%, and
(c) the additional rate is 50%.
(2) For the tax year 2013-14.
(a) the basic rate is 20%,
(b) the higher rate is 40%, and
(c) the additional rate is 45%.'
The Labour amendment was to delete 2(c) which, if passed, would have left us with no additional rate.
As the Co-Chair of the Liberal Democrat Parliamentary Treasury Committee, Stephen Williams, says:
“Labour’s biggest tax change was to remove the 10p tax rate hitting people on low and middle incomes while Liberal Democrats are giving nearly 25m basic-rate tax payers an Income Tax cut and have lifted more than a million people out of paying Income Tax altogether. At the same time, we’re making the rich pay their fair share by cracking down on loopholes and excessive tax relief."
It seems that they are determined to compound that error by giving a bigger tax break than intended to the better off.
