Latest news with #triplelock
Daily Mail
28-05-2025
- Business
- Daily Mail
Sums behind Nigel Farage's vow to spend £85billion if he wins the next election 'are implausible', experts say
Nigel Farage refused to rule out scrapping the state pensions triple lock yesterday as he struggled to defend plans for a spending splurge of up to £85billion. The Reform UK leader unveiled a string of policies in a major speech, including scrapping the two-child benefit cap, fully reinstating winter fuel payments and raising the tax-free income allowance to £20,000. He also pledged a transferable marriage tax allowance if his party wins the next election, aimed at incentivising marriage and encouraging people to have more children by making it more affordable. It would exempt one spouse from paying any tax on the first £25,000 of their income, as revealed by the Mail. But the Conservatives branded the package 'fantasy' economics and 'Corbynism in a different colour' because of the 'billions in unfunded commitments'. Experts said it could cost as much £85billion, a figure that dwarfs the £45billion of unfunded tax cuts announced by former Tory Prime Minister Liz Truss in her disastrous 2022 mini-Budget. Even leading Reform activist Tim Montgomerie, who defected from the Tories after founding the ConservativeHome site, admitted: 'The sums don't add up.' But Mr Farage insisted the pledges were 'credible' and could be paid for by scrapping the Net Zero agenda, which he claimed was costing £45billion a year. He said an extra £4billion annually could be saved from ditching accommodation for asylum seekers by deporting them and £7billion by ending the public sector's diversity, equity and inclusion (DEI) drive. A further £65billion could be saved over five years by cutting quango bureaucracy by 5 per cent, he added, giving an average saving of £69billion annually overall. But experts said raising the basic rate of income tax threshold to £20,000 could alone cost up to £80billion. At present, workers pay the 20 per cent rate of income tax on everything between £12,570 and £50,270. Lifting the two-child benefit cap would cost an extra £3.5billion and reinstating the winter fuel allowance £1.5billion. The eagerly anticipated speech was the most policy-heavy since Reform won four million votes and five seats last July. Asked if he had a 'magic money tree', Mr Farage admitted his sums were 'slightly optimistic' but added: 'We can't afford Net Zero, it's destroying the country; we can't afford DEI, it's actually preventing many talented people from succeeding; and we certainly can't afford young undocumented males crossing the English Channel and living in five-star hotels. 'You can argue about numbers adding up. You can probably argue that at no point in the history of any form of government has anybody ever thought the numbers added up. 'I think what I'm trying to do today is give you an idea of direction of policy, of priorities, of what we think is important and we think it's going to cost and how we think we can pay for it. I believe what I've presented is credible.' Dismissing a comparison to Ms Truss's mini-budget, he added: 'Liz Truss's dramatic failure was not to propose any cuts.' But he refused to guarantee keeping the pensions triple lock, raising the prospect that Reform could launch a raid on pensioners to help pay for the pledges if he comes to power, which polls suggest is possible. He admitted: 'The triple lock is not something we've addressed as yet.' The measure guarantees state pensions rise each year by whichever is highest of the annual rate of inflation, average growth in earnings or 2.5 per cent. Estimates suggest £10billion could be saved if it was scrapped and pensions were indexed to prices or wages alone. Mr Farage also defended plans to scrap the two-child benefit cap. But Tory leader Kemi Badenoch said it was right to keep the cap as it was unfair to expect taxpayers to subsidise people having large families they cannot afford. Mr Farage yesterday responded: 'This is part of a bigger package and policy we are putting together to try and make the family a more important element in British life.' Sir Mel Stride said Mr Farage had 'abandoned hardworking families who live within their means'. The Tories' shadow chancellor added: 'Farage has announced billions in unfunded commitments with fantasy ways to pay for them. It's Corbynism in a different colour.' Stuart Adam, of the Institute for Fiscal Studies, insisted raising the basic income tax rate threshold could cost up to £80billion. Lib Dem leader Sir Ed Davey branded the Reform package as 'Truss-onomics on steroids'.
Daily Mail
27-05-2025
- Business
- Daily Mail
Nigel Farage vows to reverse Keir Starmer's cut to winter fuel payments as part of £85bn package - as Tories accuse Reform leader of 'fantasy' economics
Nigel Farage refused to rule out scrapping the state pensions triple lock yesterday as he struggled to defend plans for a spending splurge of up to £85billion. The Reform UK leader unveiled a string of policies in a major speech, including scrapping the two-child benefit cap, fully reinstating winter fuel payments and raising the tax-free income allowance to £20,000. He also pledged a transferable marriage tax allowance if his party wins the next election, aimed at incentivising marriage and encouraging people to have more children by making it more affordable. It would exempt one spouse from paying any tax on the first £25,000 of their income, as revealed by the Mail. But the Conservatives branded the package 'fantasy' economics and 'Corbynism in a different colour' because of the 'billions in unfunded commitments'. Experts said it could cost as much £85billion, a figure that dwarfs the £45billion of unfunded tax cuts announced by former Tory Prime Minister Liz Truss in her disastrous 2022 mini-Budget. Even leading Reform activist Tim Montgomerie, who defected from the Tories after founding the ConservativeHome site, admitted: 'The sums don't add up.' But Mr Farage insisted the pledges were 'credible' and could be paid for by scrapping the Net Zero agenda, which he claimed was costing £45billion a year. He said an extra £4billion annually could be saved from ditching accommodation for asylum seekers by deporting them and £7billion by ending the public sector's diversity, equity and inclusion (DEI) drive. A further £65billion could be saved over five years by cutting quango bureaucracy by 5 per cent, he added, giving an average saving of £69billion annually overall. But experts said raising the basic rate of income tax threshold to £20,000 could alone cost up to £80billion. At present, workers pay the 20 per cent rate of income tax on everything between £12,570 and £50,270. Lifting the two-child benefit cap would cost an extra £3.5billion and reinstating the winter fuel allowance £1.5billion. The eagerly anticipated speech was the most policy-heavy since Reform won four million votes and five seats last July. Asked if he had a 'magic money tree', Mr Farage admitted his sums were 'slightly optimistic' but added: 'We can't afford Net Zero, it's destroying the country; we can't afford DEI, it's actually preventing many talented people from succeeding; and we certainly can't afford young undocumented males crossing the English Channel and living in five-star hotels. 'You can argue about numbers adding up. You can probably argue that at no point in the history of any form of government has anybody ever thought the numbers added up. 'I think what I'm trying to do today is give you an idea of direction of policy, of priorities, of what we think is important and we think it's going to cost and how we think we can pay for it. I believe what I've presented is credible.' Dismissing a comparison to Ms Truss's mini-budget, he added: 'Liz Truss's dramatic failure was not to propose any cuts.' But he refused to guarantee keeping the pensions triple lock, raising the prospect that Reform could launch a raid on pensioners to help pay for the pledges if he comes to power, which polls suggest is possible. He admitted: 'The triple lock is not something we've addressed as yet.' The measure guarantees state pensions rise each year by whichever is highest of the annual rate of inflation, average growth in earnings or 2.5 per cent. Estimates suggest £10billion could be saved if it was scrapped and pensions were indexed to prices or wages alone. Mr Farage also defended plans to scrap the two-child benefit cap. But Tory leader Kemi Badenoch said it was right to keep the cap as it was unfair to expect taxpayers to subsidise people having large families they cannot afford. Mr Farage yesterday responded: 'This is part of a bigger package and policy we are putting together to try and make the family a more important element in British life.' Sir Mel Stride said Mr Farage had 'abandoned hardworking families who live within their means'. The Tories' shadow chancellor added: 'Farage has announced billions in unfunded commitments with fantasy ways to pay for them. It's Corbynism in a different colour.' Stuart Adam, of the Institute for Fiscal Studies, insisted raising the basic income tax rate threshold could cost up to £80billion. Lib Dem leader Sir Ed Davey branded the Reform package as 'Truss-onomics on steroids'.
Daily Mail
20-05-2025
- Business
- Daily Mail
Hundreds of thousands of pensioners are hit with unexpected HMRC tax bills because of threshold freeze
Hundreds of thousands of pensioners have been hit with unexpected tax demands after being caught in a trap of frozen income tax thresholds and triple-lock pensions. HMRC issued some 1.32million 'simple assessments' to pensioners in the 2023/24 tax year, up 74 per cent from the year before. These are assessments carried out by the tax office on people with 'relatively straightforward tax affairs' - including those generated from state and private pensions, benefits and income from savings and investments. It calculates whether tax has been over or underpaid based on data from banks and building societies, as well as the DWP. Simple assessments save pensioners the headache of having to complete a self-assessment tax return - but can deliver a nasty surprise to those who do not believe their income exceeds the personal allowance of £12,570. The freezing of income tax thresholds since 2022 means more pensioners have unwillingly found themselves drawn into a tax trap as their state pension has risen each year thanks to the triple lock. It guarantees that the state pension will rise by either average earnings growth, inflation as dictated by the Consumer Prices Index, or 2.5 per cent - whichever is highest. The state pension rose to £230.25 or £176.45 a week for the 'new' and 'old' state pensions - the former for those who retired after April 2016 - as of April. But as a result, pensioners' average income has risen while the tax thresholds have not - dropping thousands of Brits into tax-paying territory, often without notice before a brown HMRC envelope drops through their door. Many pensioners do not get by on the state pension alone - also gathering income from, for example, private pensions. The figures on simple assessments, published by HMRC via a freedom of information request and reported by the Telegraph, show an average of 630,000 simple assessments were sent out each year between 2017/18 and 2022/23. But 1,320,755 were issued in 2023/24 - up from 757,745 the year before - suggesting hundreds of thousands of pensioners have been pushed into an income tax bracket and ambushed by the taxman. Personal allowance - the amount of income you can have tax-free - has been frozen at £12,570 since 2021, and a freeze on the thresholds was extended to 2027-28 by the Tories in the 2022 Autumn Statement. Prior to the election, Labour said it would maintain the freeze until then if elected. But tax experts say the trap is catching people off-guard - not least because they often believe they aren't bringing in enough money to be liable for tax. Steve Webb, a former pensions minister, now partner at pension consultants LCP, told the Telegraph 'hundreds of thousands' of the recipients of simple assessments were likely to be pensioners. He added: 'Many retired people on modest incomes may have hoped that their days of having to deal with HMRC were over, but the long-term freeze in tax thresholds has changed the situation. 'Although most pensioners will still not have to file a tax return, hundreds of thousands will still get an unwelcome year-end tax demand from HMRC.' The figures on simple assessment were obtained by financial advisory firm Quilter, which has previously warned that rising inflation would likely push more pensioners into the tax trap by as soon as 2027. Jon Greer, head of retirement policy at the firm, said: 'This is yet another sign of fiscal drag in action. Millions are sleepwalking into the tax system through no fault of their own. 'The sharp rise in simple assessments reflects how frozen tax thresholds and higher state pensions are creating more tax liabilities for older people. Many of them may not even realise they owe anything until HMRC's letter arrives. 'While simple assessments are meant to simplify tax collection, they can catch people off guard, especially pensioners who don't complete a tax return and assume their income is below the tax-free threshold. 'The government's freeze on allowances is quietly swelling the tax base. Unexpected tax bills can be scary especially if you are already struggling with your finances.' On a cautionary note, he added: 'If you get one and don't know what to do, the best course of action is to call HMRC to discuss your options. Do not bury your head in the sand.'
Telegraph
13-05-2025
- Business
- Telegraph
Thousands of British expats pay no UK tax on state pension
Thousands of British retirees living in Europe are claiming state pensions of up to £35,000 a year without paying UK tax, analysis shows. There were 480,906 recipients of the British state pension living in the European Union as of August 2024, according to the latest figures from the Department for Work and Pensions (DWP). Of these, some 42,000 pensioners in Europe receive UK state pensions that exceed the £12,570 personal allowance. It means they would be liable to pay 'retirement tax' in this country but are spared the bill because they are no longer UK tax residents. Britain's complex state pension system means some are raking in state pensions three times larger than the 'full' amount of £11,976. The six retirees with the largest state pensions living in EU countries received between £680 and £690 a week, or around £35,500 a year. It comes as millions of their UK counterparts are being pushed into paying income tax. This is because thresholds have been frozen since 2021 under the Tories and will remain so until 2028. At the same time, the state pension 'triple lock' has pushed up retirees' weekly payments. Around 3.3 million people already receive a state pension above the £12,570 tax-free personal allowance. State pensioners being forced to pay income tax is a politically contentious issue – which Rishi Sunak, the former Prime Minister, dubbed the 'retirement tax'. The 'triple lock' ensures payments rise by the highest of inflation, wage growth or 2.5pc each year. Recipients of the British state pension who live in the EU, European Economic Area (EEA), or Switzerland receive the same uplift. But, Britain has 'double taxation treaties' in place with all EU nations meaning British nationals living in the EU cannot be taxed twice on their income. David Denton, tax expert at Quilter Cheviot, said: 'Those receiving the state pension while living abroad with income exceeding the personal allowance may pay a different level of tax compared to those with the same income living in the UK. 'In some cases, those living abroad may take home more of their income than their UK counterparts.' The state pension is paid to nearly 13 million retirees. Of those, around 4.2 million are on the new state pension, introduced in 2016. The new 'full' state pension rose by 4.1pc to £11,973 a year last month. The remaining 8.8 million receive the old state pension, the full 'basic' element of which has hit £9,175 a year. But both pensions can be boosted above the 'full' amount. Those on the old state pension can also draw money from an additional earnings-related pension, commonly known as Serps, which can boost payments by up to £11,356 a year. Delaying the start date for drawing a state pension can also raise the amount you receive. Baroness Altmann, a former pensions minister, said: 'The real problem is that the frozen tax threshold is perilously close to the full new state pension. 'And for those who receive high amounts of Serps, the state pension is far more generous than those who paid National Insurance during the non-Serps years, or when the generosity of Serps was reduced. 'This means that anyone who lives in other countries will be paying a different amount of tax, depending on the income tax rules where they live and some may pay no tax at all.'
BreakingNews.ie
10-05-2025
- Politics
- BreakingNews.ie
‘Hands off Irish neutrality': Opposition pushes back against triple-lock changes
Opposition politicians have pledged to 'fight like hell' to push back against Government efforts to change the State's system for deploying troops abroad. Sinn Féin leader Mary Lou McDonald and other Opposition TDs and Senators decried it as an act that would erode 'cherished' Irish neutrality. Advertisement The Government has said it will change the triple-lock system for deploying troops abroad, which currently requires Government, Dáil and UN approval to send more than 12 Irish peacekeepers overseas. Under draft legislation being advanced by the Government, it is proposed to remove the need for formal UN approval and replace it with a stipulation that the Defence Forces deployment would be in accordance with the UN Charter. The Government has argued this will prevent the permanent members of the UN Security Council – Russia, China, the UK, the US and France – from vetoing Irish peacekeeping missions. At a packed meeting room in the Gresham hotel in Dublin city on Saturday, people were urged to protest in the streets over the issue. Advertisement Actor Liam Cunningham and award-winning folk singer Eoghan Ó Ceannabháin performed at the event, organised by the Irish Neutrality League. Senators Alice Mary Higgins and Frances Black, Galway West TD Catherine Connolly, People Before Profit TD Paul Murphy and Social Democrats TD Sinead Gibney spoke at the event. Sinn Féin leader Mary Lou McDonald speaking to the media at an Irish neutrality rally at the Gresham hotel. Photo: PA Ms McDonald said the opposition would work together to push back against efforts to change neutrality. She told the rally: 'So if Micheál Martin or Simon Harris really believe that they have this right, if they really are convinced by their own argument, if they want to get rid of our position as the neutral, I say to them: 'Go to the people, put the question, and she'll get your answer'.' Advertisement She encouraged people 'to campaign relentlessly' and to 'put feet on the streets'. She also said: 'They believe that they can push ahead with their plans unchallenged. We have news for them, because we will fight like hell to stop them, and our message to Micheal Martin and to Simon Harris and to Ursula von der Leyen is very clear – hands off Ireland's neutrality.' Ms Connolly said Ireland's peace is threatened 'by the war-mongering military industrial complex' embraced by countries in Europe. 'We're here to give one message to the Government, and the message is neutrality matters to us,' she said. Advertisement 'We will not give it away, and we will not give away the triple-lock, no matter what lies you tell us, no matter what narrative you spin, we know what's going on.' Ms Black said it was important to protect 'both neutrality and the triple-lock from the unacceptable erosion planned by this current Government'. She said the triple-lock guaranteed that Ireland's Defence Forces would 'never be deployed in an illegal war' and it was 'staggering' to take action that endangered that commitment. 'For many of us, neutrality is political, but also deeply personal,' she said. Advertisement 'What damage could this regressive move do to Ireland's reputation internationally, especially when our strong voice on Palestine is needed now more than ever?' Ms Higgins said that Ireland was elected to the UN Security Council due to its 'huge credibility' on 'peace and neutrality and disarmament'. Ireland Neutrality 'completely unaffected' by triple lock... Read More She said Ireland should be at the 'centre' of efforts to reform the UN rather than removing their involvement in deploying Irish troops. 'The triple-lock does not prevent defence of our own borders, the triple-lock does not prevent humanitarian action by Ireland and, of course, the triple-lock can be activated by the General Assembly as well as the Security Council.' A pro-peace protest in Dublin city is planned on June 14th.
