Take lowest earners out of tax

Manchester City Council will consider today whether the lowest paid workers should be paying income tax. I seconding a Manchester Liberal Democrats motion at full Council calling the for the Government to change the tax rules so that those on the minimum wage would pay no income tax.

Increasing the personal income tax allowance to £10,000 was a key Lib Dem election pledge at the last general election. From next April the single person’s tax allowance will rise to £10,000. Nick Clegg, the Lib Dem Leader and Deputy Prime Minister recently said this should rise further to £10,500 by 2015. As a result over 133,000 Mancunians and 24.5 million average workers across the country will receive a £700 tax cut before the next general election. Over 14,300 of the lowest earning Mancunians will be taken out of paying income tax altogether.  But the Manchester Lib Dem motion is calling for the threshold to rise even further. They want the Council to lobby the Government so that in future a full time worker on the minimum wage will not pay any Income Tax.

It is only thanks to the Lib Dems in Government that over a hundred thousand Manchester residents are receiving a £700 tax cut and thousands have been taken out of paying income tax altogether. However this is only the start and those on the lowest wages are still paying more than they should; thousands more workers should be taken out of the tax system altogether.

South Manchester Lib Dem MP John Leech tabled a Parliamentary motion on the issue in 2011.

John said: “I was disappointed that no other Manchester or Labour MP signed my motion and backed this idea. However I’m pleased that Nick Clegg is the only party leader to say that people on minimum wage should not pay any income tax at all. He has made it clear that this is central to what the Lib Dems would be pushing for if they are in the next Government."

The Liberal Democrat motion is available as Item 11 on the Council’s agenda: http://www.manchester.gov.uk/meetings/meeting/1916/council

John Leech’s Early Day Motion is available here:  http://www.parliament.uk/edm/2010-12/2335