Tax Cut For Over 275,000 People In Cambridgeshire

On 6 April 2012 the Personal Allowance will be raised for the second year in a row, meaning that 276,900 people in Cambridgeshire will get a £130 Income Tax cut and the number people in the area who have been lifted out of paying any Income Tax will reach 8,200.

Julian Huppert, Member of Parliament for Cambridge, said “when the Liberal Democrats first came into office, millions of low-paid workers were paying a higher proportion of their income in tax than the richest were. This was clearly unfair.

“We have made reducing the tax burden on the very poorest a priority, a promise that was on the front page of our manifesto.   Over 20m basic-rate taxpayers have received a £330 tax cut since the Coalition Government came into power. We will continue to increase the Personal Allowance, the threshold at which people start paying Income Tax, until it reaches £10,000. This means that someone working full-time on the minimum wage will have had their Income Tax bill halved.

“At the same time, the Liberal Democrats are making sure the rich pay their fair share, by closing loopholes, introducing a tycoon tax and cracking down on tax avoidance. All of this will mean that the richest pay five times more than they did under the 50p tax rate. As we clean up the economic mess Labour left behind, it is right that the broadest shoulders bear the heaviest burdens.”

The Personal Allowance, also known as the Income Tax threshold, will rise to £8,105 on 6 April 2012, up from £6,475 under Labour.

In the early 1970s, the Personal Allowance was worth around 28% of average earnings. By 2010 that had dropped to around 20% as wages had outpaced the increase in the Allowance.

Vince Cable: Putting More Money Back In *Your* Pocket

As families face more of a squeeze, today Liberal Democrats are arguing for greater tax cuts for hard working people.

Between now and the Budget, Nick and Danny and I will be arguing for faster tax cuts, giving you a reward for hard work. And Nick will be setting out our case in a speech today.

Given the budget constraint we have to raise money for the tax cut elsewhere and have plans to raise an equivalent amount from the wealthiest taxpayers.

At the last election the Liberal Democrats promised to raise the personal allowance for ordinary taxpayers to £10,000. I am proud that the Coalition has committed to doing so over the course of this Parliament.

For millions of ordinary hard working people, that means paying £700 less in income tax each year. Low earners, mostly women will benefit from being lifted out of tax altogether.

But times are tough and quite simply, Liberal Democrats in Government want to help families who are currently being squeezed by moving more quickly.

Whether it’s targeting an extra £7bn from tax evaders and avoiders, taking an extra £2.5bn every year from the banks in a balance sheet tax, or the announcement I made on Monday to curb the excesses of executive pay, this Coalition is taking important steps to deliver a fairer economy.

And we have already made a big difference, click here to see how.

We are building a new economy, one that benefits the whole country, not just bankers in the City of London. Making the tax system fairer is crucial to that. This is a huge task that will make Britain a fairer and more liberal country for generations to come.

Yours,

Vince Cable MP

Member of Parliament for Twickenham and Secretary of State for Business, Innovation and Skills