Following yesterday’s 2018 Budget, Worcester MP Robin Walker has welcomed a range of tax relief and cost-of-living measures announced by the Chancellor that will put more money in the pockets of local people.
Among the measures announced yesterday was a £650 rise in the tax-free Personal Allowance to £12,500 a year earlier than planned. This means a basic rate taxpayer will pay £1,205 less tax in 2019-20 than in 2010-11.
In addition, the National Living Wage is set to rise by 4.9% from April, from £7.83 per hour to £8.21. This will hand a full-time worker a £690 annual pay increase and will take their total pay rise since the introduction of the NLW to over £2,750 a year.
The Higher Rate Threshold will increase from £46,350 to £50,000 in April 2019, with the amount people will have to earn before they pay tax at 40% increasing from £46,350 to £50,000 in April.
Fuel duty has been frozen for the ninth consecutive year, bringing the total saving to the average car driver to over £1,000 since 2010, and to the average van driver to over £2,500.
Duty on beer, cider, and spirits has been frozen for a further year, with the cost of a pint of beer set to be 2p lower than if duty had risen by inflation. Meanwhile, holidays will continue to be more affordable thanks to a continued freeze in Air Passenger Duty on short-haul flights.
Commenting on the Budget, Robin said:
“The measures announced by the Chancellor yesterday mean more money in the pockets of Worcester residents. Government decisions on tax, welfare, and public spending since 2016 mean that all households are better off – with the poorest households gaining the most.”
“Bringing forward a £650 increase in the tax-free Personal Allowance will give a noticeable boost to pay packets, and I have long supported the policy as a way of reducing the tax burden, particularly on lower earners.”
“These measures mean that someone working 40 hours a week on Minimum Wage will have seen their annual pay packet rise from £11,200 in 2010 to £17,100 next April – a 38% rise in income that increases to 44% after tax when measures such as the tax-free Personal Allowance are taken into account.”
“Clamping down on tax evasion has meant higher tax receipts for the Treasury, and the Chancellor has heard the calls from myself and other colleagues to use this additional revenue to help hard-working people in places like Worcester see a tangible increase in their wage packets.”
Post-Budget analysis has shown that for a married couple both earning an average salary with two teenage children, tax threshold changes mean their joint tax bill falls by £260 a year, while National Insurance is £48 lower – making them £308 a year better off.
Meanwhile, a couple on a State Pension will see a weekly increase in the income of £6.45 thanks to a 2.6% rise in pension credit. This marks an annual increase of £335.
Notes to editors
For full details of the 2018 Budget, see https://www.gov.uk/government/topical-events/budget-2018
For Robin’s previous statements on tax and the cost of living, see: