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Tax Allowance Shift Sparks Debate | Leeds News
Prime Minister Andy Burnham is eyeing a long-overdue tweak to the tax-free personal allowance—frozen since 2021—which could pull more workers into higher tax brackets as wages rise, a phenomenon known as fiscal drag. He’s also set to scrap VAT on energy bills starting October. Currently, you pay no tax until you earn £12,570; anything above that kicks in 20% tax. Experts warn even a modest £500 boost could cost the Treasury billions. Dan Neidle of Tax Policy Associates calls it a “bad tax cut,” noting it’d save basic rate taxpayers just £100 a year but cost £5 billion. He argues cutting…
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