Reports in the Press this week suggest that as many as 160 Tory MPs support the call to cut the top rate of income tax from 45p to 40p in the July 8th budget. They believe that, by reducing tax rates for the highest earners, it produces more economic activity, which leads to more tax revenue.
The Chancellor, George Osborne, will deliver his first Budget speech since May’s General Election victory in a little over a week’s time, and will be setting out his plans for the next five years in office – however, cutting the upper tax bracket will prove a contentious move. The top rate has fluctuated in recent years, with Labour increasing it from 40p to 50p in 2009 after the financial crisis, before Osborne brought it down to 45p in his 2012 Budget.
If you would like to speak to us about how the possibility of a cut in the top rate of income tax could affect you, or how to best prepare for a change in thresholds, please call Alan Clifton on 0800 731 7614 or e-mail Alan.Clifton@fpgonline.co.uk