Oral Answers to Questions

Debate between Jack Lopresti and David Gauke

Tuesday 1st March 2016 Commons Chamber

[Jack Lopresti (Filton and Bradley Stoke) (Con)]

13. What fiscal steps he is taking to help people keep more of their earnings.

[The Financial Secretary to the Treasury (Mr David Gauke)]

The Government have committed to raising the personal allowance to £12,500 and the higher-rate threshold to £50,000 by the end of this Parliament. At the summer Budget, the Government took the first steps towards meeting these commitments by increasing the personal allowance to £11,000 and raising the higher-rate threshold to £43,000 in 2016-17. Twenty-nine million people will pay less tax after these changes and 570,000 will be taken out of income tax altogether.

[Jack Lopresti]

Does the Minister agree that it would be better to encourage savings by allowing people to keep more of their own money by increasing the tax limit on pensions rather than reducing it, particularly at a time when savers are struggling to get decent returns?

[Mr Gauke]

As a Government, we want to encourage more saving. We have taken steps to reform our tax system so that pensions become more attractive, but we also need to ensure that the costs of pension tax relief are targeted in the right direction.