17 June 2024
If you are covering Reform manifesto, please see the following comment from Rachael Griffin, tax and financial planning expert at Quilter:
"In a move that’s sure to stir the political pot, Reform UK has unveiled a suite of policies aimed squarely at the values of the Conservative right. By promising to raise the stakes in the tax and migration debate, the party is offering a feast of ‘red meat’ policies that are likely to energise right-wing supporters.
"The pledge to increase tax thresholds would be a welcome proposition for many, signalling a potential increase in take-home pay for hardworking people. However, the specifics of how that would be funded lacks detail, leaving voters to wonder about the financial feasibility of such promises.
"As with many tweaks to the tax system while this policy would lift lots of people out of having to pay income tax, it also means that those on higher-than-average salaries pay much less in tax too.
"There are lots of reasons why a lower tax environment can stimulate economic growth but measures like these can take time to feed through and on the face of it these kinds of pledges can look like a giveaway to the wealthier. Given the current economic environment, the optics of handing someone with a salary of £75,000 a nearly £5,500 per year saving while those on the average salary only save £1,486 might be difficult for many to stomach.
"These kinds of tax giveaways are not easy to fund and such a radical shake up would cost the government billions at a time when the public purse strings are stretched. As is often the case manifesto pledges among the smaller political parties are designed to ignite public debate rather than have a chance of being realistically implemented.
"As the battle lines are drawn, it is clear that Reform UK is not just chipping away at the status quo — it is shooting for the moon. Whether these tax pledges will prove to put pressure on the Tory and Labour policies remains to be seen, but they’re certainly poised to shake up the conversation on Britain’s fiscal future."
How the income tax proposals would impact various salaries
|
Proposed |
|
||
|
Personal Allowance |
£20,000.00 |
|
|
|
Higher Rate threshold |
£50,000.00 |
|
|
|
Income |
Current |
New |
Saving |
|
£35,000.00 |
£4,486.00 |
£3,000.00 |
£1,486.00 |
|
£50,000.00 |
£7,486.00 |
£6,000.00 |
£1,486.00 |
|
£75,000.00 |
£17,432.00 |
£12,000.00 |
£5,432.00 |
