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Prime Minister David Cameron: tax cut this Sunday is 'one of the proudest things I have done in government'.
As a result of a landmark government policy and a key plank of the long-term economic plan, over 3 million people will have been taken out of income tax altogether from this weekend. This is thanks to a series of increases in the tax-free personal allowance to £10,000 in 2014 to 2015.
This means that overnight on Sunday, an extra 255,000 hard-working people will no longer pay income tax.
Over 26 million people – the vast majority of working people – will have benefited from the personal allowance increases over the past 4 years.
This year’s rise means that the typical taxpayer is now paying £705 less income tax than they were in 2010. Over the lifetime of this parliament, the cumulative income tax cut by this government for the typical taxpayer will be £1,824.
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The Prime Minister said:
A key part of this government’s long-term economic plan is to cut taxes so that people can keep more of the money they earn and feel more financially secure. Nearly 9 out of 10 hard-working people across the country will benefit from this tax cut on Sunday - and it’s one of the proudest things I have done in government.
The changes on Sunday 6 April also mean that:
- someone currently working full-time on the national minimum wage will pay nearly two thirds less income tax than at the election
- someone on the national minimum wage working for around 30 hours a week will not pay any income tax at all
This means more support for many of those who work flexibly and part-time.
Meanwhile, women make up the majority (54%) of the 3 million people who no longer have to pay income tax thanks to the increases to the personal allowance since 2010.
And as the Chancellor announced in the 2014 Budget, the personal allowance will help even more hard-working families next year when it is increased again to £10,500.
Today the Prime Minister begins a 4-day economy-focused tour to see the impact of government help for businesses, and to highlight the significant tax changes such as corporation tax cuts which come into effect this week.
Following Prime Minister’s Questions, David Cameron will travel to the North West of England where he will host a PM Direct question and answer session with employees at a major retailer in Greater Manchester.
On Thursday, he will welcome a number of new job announcements and then, while visiting a FTSE 100 company, he will also host a second PM Direct question and answer session with employees.
Day 3 will take him to the South West of England, to see progress following the recent adverse weather.
Then on Saturday he will visit a small business in London which is set to benefit from the £2,000 cashback from the Employment Allowance coming into effect on Sunday.
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Infographic featured taken from HM Treasury’s “A Budget for hardworking people” slide.