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: Nick Clegg' plans to raise personal tax allowance 'will help better-off more than low-paid'
IPPR study also called into question his claim that raising allowance to £10,500 would mean a tax cut of £100 a year
The Liberal Democrats, who have persuaded the Conservatives to raise the income tax threshold to £10,000 a year from next April, have proposed a further rise to £10,500 in April 2015. Mr Clegg's party will fight the election the following month on a pledge to increase the allowance to £12,500 a year during the next parliament.
The Lib Dems have contrasted their flagship plan to help "ordinary workers" with the Tories' decision to cut in the top tax rate from 50p to 45p. But analysis by the Institute of Public Policy Research (IPPR) think tank shows that under Mr Clegg's plans, people in the seventh, eighth and ninth of the 10 deciles on the earnings ladder would see a bigger percentage rise in their income than those lower down the scale.
The IPPR study also called into question the claims made by the Deputy Prime Minister last weekend. He said that raising the personal allowance to £10,500 would mean a tax cut of £100 a year. The IPPR put the figure at £54. Mr Clegg put the cost at £1bn, but the think tank said the move would cost £1.28bn. It also warned that raising the allowance so that no one on the minimum wage would pay income tax (currently £12,500) could cost up to £20bn.
Full story Independent.
