Press Room
Abolition of 10p rate forces dependence on tax credits
If you are writing about the debate on the abolition of
the 10p rate band please consider the following comment from Mike
Warburton, senior tax partner at Grant Thornton:
"It's strange that a government that pledges support for those
on low incomes can put a further dent in the pockets of these
individuals by abolishing the 10p rate of income tax*."
"The abolition of the 10p rate effectively makes low income
earners reliant on the tax credit system. So rather than encourage
individuals off benefits, the government is increasing their
dependence on state assistance to maintain levels of income they
were previously used to."
"It's great that considerations on possible revisions to
taxation of low income earners is being discussed in the house this
week, but why only now? Surely, when this problem was spotted in
March last year, action could have been taken earlier to work out a
solution over the proceeding 12 months before the changes took
effect."