Labour Tax Changes Penalise Local Residents on Low Incomes (Saffron Walden Constituency Liberal Democrats)

Saffron Walden Constituency Liberal Democrats <info@saffronwaldenlibdems.org.uk>

Labour Tax Changes Penalise Local Residents on Low Incomes

April 15, 2008 10:08 PM

Gordon Brown's Labour government is increasing on people with low incomes.

LIBERAL Democrats in Saffron Walden Constituency have launched a stinging attack on the Government for bringing in tax changes that have increased income tax bills for thousands of residents of this area.

On 6th April, Labour doubled the starting rate of income tax from 10p to 20p in the pound. Previously, a 10p rate was paid on the first £2230 of taxable income. As a result, instead of taking £223 in income tax on this portion of people's wages, Gordon Brown's government is now taking £446.

Though the standard rate of income tax has been cut from 22p to 20p in the pound, a single person with no children would have to be earning over £18,500 to be better off under the tax changes.

"Labour has pushed up taxes on people on low incomes in order to fund tax cuts for the better off," said Peter Wilcock, Parliamentary Spokesperson.

"Thousands of residents on lower incomes in this area are now receiving sharply increased tax demands at the same time as the council tax bills are arriving. And many are also facing big increases in bills for gas, electricity and transport.

"Gordon Brown announced his tax grab a year ago. But in that time Labour has done nothing to reduce the impact of their tax demands. It seems Labour has totally lost touch with the reality of ordinary people's lives. Labour no longer appears to be on the side of ordinary people."

Under Labour's tax grab, a single person with no children earning less than £18,500 will be a net loser, by up to £232 a year. People taking early retirement with a taxable income of less than £8,000 will lose, by up to £232 a year.

Liberal Democrat plans to cut the tax burden for those on low income include: scrapping council tax and replacing it with a local tax based on ability to pay; cutting the standard rate of national income tax by 4p in the pound, paid for by closing tax loopholes used by the wealthy; and by increasing green taxes (such as the duties paid by the most polluting vehicles and those who travel in the most polluting aircraft).