Content
After U, Gordon?
Ups And Downs
Gift Horse
What A Relief!
Second Thoughts?
Last One Out...
Penalty Shoot-Out
Ain't Necessarily So
Going, Going, Gone
Papers In Order?
Death And Taxes
Passing The Buck
Hire Higher
Back Taxes, Taxes Back
Options Open
Extortion?
Sick Note
Cats And Dogs
Old-Fashioned Money
I Thee Endow?
Mother's Rights
Countdown
Nowhere To Hide
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When she was Prime Minister, Lady Thatcher was famously "not for turning". Now Gordon Brown has been forced to accept an astonishing U-turn, upsetting the headline-grabbing changes to income tax rates he made in his last Budget in 2007. Alistair Darling had to announce an increase in personal allowances to compensate those low earners who lost out as a result of the abolition of the 10% tax rate on 6 April 2008. The Chancellor had to tell Parliament, but it was Mr Brown who admitted he had made a mistake in failing to realise the impact of his changes on the very people his party have traditionally stood up for. No-one can remember such a thing happening before. The personal allowance is usually an uncontroversial part of the Budget, and for it to be changed after the Revenue have sent everyone their notices of coding - after tax rate cards have been printed and despatched - is unprecedented. Although there will be a lot of extra paperwork to deal with it, it seems to be quite a simple move: the first £6,035 of income will be tax-free instead of £5,435, and higher rates of tax will start after another £34,800, instead of £36,000 on top of the £5,435. It won't affect those entitled to the higher age-related allowances, because those had been put up to allow for the rate changes anyway. As Lady Thatcher would no doubt have argued, though, it's an unhappy precedent to set. Once you give in on something like that, where will it end? The foreign domiciled taxpayers who are now liable for a £30,000 flat rate tax on their foreign income may be looking at this with interest - if they have not already left. Whichever way Messrs Brown and Darling twist and turn, we will do our best to keep you informed. |
© Bayar Hughes & Co., 2010.