Clause 2 - Basic rate limit for 2015-16 and personal allowances from 2015

Part of Finance (No. 2) Bill – in a Public Bill Committee at 9:45 am on 29 April 2014.

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Photo of Shabana Mahmood Shabana Mahmood Shadow Minister (Treasury) 9:45, 29 April 2014

I am grateful to the hon. Gentleman for his intervention, but I disagree that the tax take will decrease. I believe that the measure would raise revenue. On the analysis that the Government have accepted, it would raise £100 million, and I think that it has the capacity to do more. A set of measures on HMRC’s capacity and targeted anti-avoidance measures to protect revenue could have an impact on getting the deficit down. In terms of getting the deficit down more fairly, it is important, given that ordinary working people are £1,600 a year worse off since the general election, that we send a signal about our expectations when it comes to who bears the greatest burden as we get the deficit down. After all, the Government are not averse to sending signals through the tax system, as they recently did with the tax allowance for marriage. Millions of ordinary working people are struggling to pay their gas and electricity bills and are worried about paying for child care—they may even have to choose not go to work because child care is so expensive—so it is completely the wrong priority to hand some of the richest people in our society a tax cut worth up to £100,000. That sends the wrong signal and the Government should not have done it, so we will reverse it.