Victory!
A big victory for this petition at yesterday's Budget. The Chancellor announced that he was introducing a new Pension Tax Allowance (PTA). This concession is solely down to the long campaign conducted by Silver Voices and your support for this petition.
John Healey announced that the PTA would ensure that any pensioner whose income (from any source) is equal to or below the value of the full new state pension next April (£13036) will not pay tax. This is a big improvement on the Rachel Reeves formula which would have stopped anyone with income other than the basic state pension from benefiting. However, because the Government has stopped short of raising the tax threshold for all pensioners, as we had argued, there is inbuilt unfairness for those just above the new limit! So, the Government has introduced a complex tapering arrangement for those just above the limit, also reducing the tax bill for those with an income between £13037 and £13,319. Both these levels will be uprated each year until 2030, based on the Triple Lock rises.
Although our aim of getting the personal tax allowance for all pensioners raised by at least £1000 has not been met, we have succeeded in establishing an important principle, any income level up to the value of the full new state pension, should not be taxable. It will be difficult for any future government to wriggle out of that one.
It was, however, very disappointing for all low-income households that the frozen tax thresholds were once again left untouched. The Chancellor was therefore quite wrong to claim that he was not increasing taxes on ordinary tax payers.
The PTA will cost the Government £200 million a year by 2030, all going to poor pensioner households, so Silver Voices can achieve victories on behalf of older people even in the current climate!
Trust us now to campaign hard to save the Triple Lock and to start a new campaign to close the scandalous growing gap between the old and new state pensions.
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