With the 2015 election looming, Chancellor George Osborne is coming under increasing pressure from within his own party to make announcements in the Budget that will win the Tories votes, and is being advised that scrapping the 40p rate could be an \u201ciconic pledge\u201d.<\/p>\n
The latest voice comes from Nadhim Zahawi, a member of the Number 10 Policy Board. Speaking at a recent think tank event organised by Policy Exchange, Mr Zahawi said that the Chancellor and Prime Minister must \u201cseriously debate\u201d the benefits of a 40p tax rate, as it hits millions of middle class workers, not necessarily the richest in the land.<\/p>\n
Mr Zahawi was echoing calls from Renewal, a Conservative party pressure group, which has been urging Mr Osborne to deliver the cut, which would be worth \u00a32,000 a year for more than two million workers.<\/p>\n
The 40 per cent tax band for high earners was first introduced twenty-five years ago by former Conservative Chancellor Nigel Lawson but at the time, only one in 20 people paid the higher rate, compared to one in six people today.<\/p>\n
While the Conservatives have pledged to help the lowest paid by raising the tax-free personal allowance, which has freed more than two million people from the tax system, the \u2018squeezed middle\u2019, earning between \u00a340,000 and \u00a360,000 a year, has been squeezed even harder, as below-inflation wage rises drag more people into the higher tax band.<\/p>\n
Around a million middle-income workers will receive a pay rise this year, but this is not enough to counteract the growing cost of living and it is estimated that another million middle class workers will fall into the top income tax bracket after passing the \u00a341,450 threshold.<\/p>\n
However, this week, the Prime Minister said that his party\u2019s priority will be giving tax breaks to low earners.<\/p>\n","protected":false},"excerpt":{"rendered":"
With the 2015 election looming, Chancellor George Osborne is coming under increasing pressure from within his own party to make announcements in the Budget that will win the Tories votes, and is being advised that scrapping the 40p rate could be an \u201ciconic pledge\u201d.<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"_links":{"self":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/132"}],"collection":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=132"}],"version-history":[{"count":1,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/132\/revisions"}],"predecessor-version":[{"id":133,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/132\/revisions\/133"}],"wp:attachment":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=132"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=132"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=132"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}