Most Popular
1. THE INFLATION MONSTER is Forecasting RECESSION - Nadeem_Walayat
2.Why APPLE Could CRASH the Stock Market! - Nadeem_Walayat
3.The Stocks Stealth BEAR Market - Nadeem_Walayat
4.Inflation, Commodities and Interest Rates : Paradigm Shifts in Macrotrends - Rambus_Chartology
5.Stock Market in the Eye of the Storm, Visualising AI Tech Stocks Buying Levels - Nadeem_Walayat
6.AI Tech Stocks Earnings BloodBath Buying Opportunity - Nadeem_Walayat
7.PPT HALTS STOCK MARKET CRASH ahead of Fed May Interest Rate Hike Meeting - Nadeem_Walayat
8.50 Small Cap Growth Stocks Analysis to CAPITALISE on the Stock Market Inflation -Nadeem_Walayat
9.WE HAVE NO CHOICE BUT TO INVEST IN STOCKS AND HOUSING MARKET - Nadeem_Walayat
10.Apple and Microsoft Nuts Are About to CRACK and Send Stock Market Sharply Lower - Nadeem_Walayat
Last 7 days
Qualcom Stock Market Harbinger - 12th Aug 22
Apple Exec Gets World's 1st iPhone 14 for Daughters 14th Birthday Surprise Present Unboxing! - 12th Aug 22
Steps to remember while playing live roulette online - 12th Aug 22
China Bank Run Protests - Another Potential Tiananmen Square Massacre? - 11th Aug 22
Silver Coin Premiums – Another Collapse? - 11th Aug 22
Gold-to-Silver Ratio Heading Lower – Setup Like 1989-03 - 11th Aug 22
Severe Stocks Bear Market: Will You Be Among the Prepared 1.5%? - 11th Aug 22
There's a Hole in My Bucket Dear Liza, UK Summer Heatwave Plants Watering Problem Song - 11th Aug 22
Why PEAK INFLATION is a RED HERRING! Prepare for a Decade Long Cost of Living Crisis - 9th Aug 22
FREETRADE Want to LEND My Shares to Short Sellers! - 8th Aug 22
Stock Market Unclosed Gap - 8th Aug 22
The End Game for Silver Shenanigans... - 8th Aug 22er
WARNING Corsair MP600 NVME2 M2 SSD Are Prone to Failure Can Prevent Systems From Booting - 8th Aug 22
Elliott Waves: Your "Rhyme & Reason" to Mainstream Stock Market Opinions - 6th Aug 22
COST OF LIVING CRISIS NIGHTMARE - Expect High INFLATION for whole of this DECADE! - 6th Aug 22
WHY PEAK INFLATION RED HERRING - 5th Aug 22
Recession Is Good for Gold, but a Crisis Would Be Even Better - 5th Aug 22
Stock Market Rallying On Slowly Thinning Air - 5th Aug 22
SILVER’S BAD BREAK - 5th Aug 22
Stock Market Trend Pattren 2022 Forecast Current State - 4th Aug 22
Should We Be Prepared For An Aggressive U.S. Fed In The Future? - 4th Aug 22
Will the S&P 500 Stock Market Index Go the Way of Meme Stocks? - 4th Aug 22
Stock Market Another Upswing Attempt - 4th Aug 22
What is our Real Economic and Financial Prognosis? - 4th Aug 22
The REAL Stocks Bear Market of 2022 - 3rd Aug 22
The ‘Wishful Thinking’ Fed Is Anything But ‘Neutral’ - 3rd Aug 22
Don’t Be Misled by Gold’s Recent Upswing - 3rd Aug 22
Aluminum, Copper, Zinc: The 3 Horsemen of the Upcoming "Econocalypse" - 31st July 22
Gold Stocks’ Rally Autumn 2022 - 31st July 22
US Fed Is Battling Excess Global Capital – Which Is Creating Inflation - 31st July 22

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

New UK Government Tax Cut, Annual Tax Free Allowance to Rise to £10,000

Politics / Taxes May 11, 2010 - 05:44 PM GMT

By: Nadeem_Walayat

Politics

The New Conservative / Lib-Dem coalition UK government is expected to cut UK taxes for most tax payers by £705 per year as part of coalition deal. The Lib-Dem Tax cut policy to be phased in over x years will take the form of the annual tax free allowance rising from £6,470 to £10,000 which is aimed at lifting the low paid totally out of income tax, however it will at the same time benefit all tax payers.


The £17 billion tax cut to be phased in will be financed by a series of separate tax rises that will hit the higher paid who will finance the tax cut, details of which will be announced in the emergency budget within 50 days.

Effect of the Lib Dem Tax Cut.

Gross Earnings Current Income Tax Tax New Income Tax Better Off by
£10,000
£705
£0
+£705
£15,000
£1,705
£1,000
+£705
£20,000
£2,705
£2,000
+£705
£25,000
£3,705
£3,000
+£705
£30,000
£4,705
£4,000
+£705
£50,000
£9,930
£8,520
+£1,410

 

  • The above excludes NI tax which is expected to rise, i.e. average basic rate tax payers will thus see little overall change.
  • Excludes higher rate tax rises still to be announced.
  • Excludes inpact of stealth tax rises such as VAT.
  • Implementation is pending details of how the tax cut will be phased in, i.e. over how many years.

Once the exact details of all tax proposals have been announced in the emergency budget within 50 days, then it will become clear how far the overall tax burden for those earning more than about £15,000 per year will rise, and significantly so for the higher paid.

Source: http://www.marketoracle.co.uk/Article19406.html

By Nadeem Walayat

http://www.marketoracle.co.uk

Copyright © 2005-10 Marketoracle.co.uk (Market Oracle Ltd). All rights reserved.

Nadeem Walayat has over 20 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis specialises on UK inflation, economy, interest rates and the housing market and he is the author of the NEW Inflation Mega-Trend ebook that can be downloaded for Free. Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication. We present in-depth analysis from over 500 experienced analysts on a range of views of the probable direction of the financial markets. Thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.

Nadeem Walayat Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

Dr Ray
12 May 10, 11:42
personal allowance for the higher paid

Don't forget that the last budget abolished personal allowances for the higher paid (£100K +)so they may not be better off at all with the new proposed threshold.


Nadeem_Walayat
12 May 10, 19:34
UK Taxes

Yes a lot of tax rises are due to hit which ensure that in the end only those that earn UNDER £15k will be better off.

Offcourse even these may see a cut if tax credits are also cut.


mrs halls
13 May 10, 19:10
tax allowance

yes the income for lower paid will go up with the tax allowance but then taken away in loss of certain benefits because it will be counted as extra income , leaving them no better off , but as it's for all the higher paid will benefit from the rise. How is this fair?


Nadeem_Walayat
13 May 10, 20:17
Tax allowances and low paid.

Hi

Benefits such as tax credits are paid on the basis of gross earnings, so it should not result in loss of benefits to the low paid.

The higher paid will be hit hard by tax rises that far outweigh the benefits from the tax allowance change as the government will raise approx £35 billion from tax rises.

Once the new government has revealed more data I will try and estimate what the net overall tax picture will mean.


mrs halls
15 May 10, 19:57
benefits after tax allowance starts

Hi Thanks for your reply , Housing benefit and Council tax benefit are worked out on your income not gross amount , so unless the goverment put up the amount needed to live on, the low paid will not be any better off.


aden
09 Sep 10, 10:53
£10,000 tax allowance

Why do they make the promise that it will happen in X years and not be honest enough to give a date, Promises can be broken and carrots can go rotten before you eat them. Many of my colleagues voted either LibDem or Tory, Now that their employment and lifestyles are under threat they now regret not voting Labour. If most people are honest they would say the same, Me thinks.


Nadeem_Walayat
09 Sep 10, 17:22
Labour

Labour would have bankrupted Britian, where even a £100k tax free allowance would be worthless.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in