Tax rate of 60%
December 3, 2008 10:47 AM
Taxation - feeling the pain
Matthew Vincent writing in the Financial Times of 29th Nov points out that the Chancellor's plan to reduce the personal allowance of those being paid £100000p.a. by £1 for every £2 earned such that the allowance disappears at £106450 p.a. represents a 60% rate of tax.
This mechanism for reducing the personal allowance, and consequent 60% tax ate, has been applied for years to the higher personal allowance for pensioners. But it applies to pensions in the £20k p.a. region without arousing much comment. Pensioners will not much much care if similar pain is inflicted on those getting five times as much. Liberal Democrats are the only Party which is seriously interested in fair taxation.
Mike Turner, 3 Saltcotes Rd., Lytham St. Anne's, FY8 4HN
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