Income Tax Threshold

Lord Kirkhope of Harrogate Excerpts

Tuesday 4th July 2023 Lords Chamber

[Baroness Penn (Con)]

My Lords, we have worked hard to put tax cuts in place for working people, which is why we have raised the personal allowance. The increase to the starting threshold for paying national insurance was raised last year by the largest single amount, helping people who are currently facing challenges with the cost of living. The noble Baroness mentioned the changes we have made to pensions tax. That is to try to keep experienced professionals in our public sector workforce, from doctors to head teachers and members of the military. Those changes were made for the right reasons and will have the right effect.

[Lord Kirkhope of Harrogate (Con)]

My noble friend is quite right about the need to tackle inflation above all else. In the same way as the Government are discouraging excessive wage demands because they are inflationary, is it not correct that any attempt to change the tax system to chase inflation would be equally dangerous for the economy?

[Baroness Penn (Con)]

My noble friend is absolutely right. That is why, when we have looked at what support we can put in place for people, our number one aim is not to make the problem of inflation worse. We were able to do that through announcing the mortgage charter, which will provide important relief to people struggling with higher interest rates while not making the problem worse.