The Liberal Democrats have announced they will be voting against the Government’s plans to raise the higher-rate tax threshold to £50,000.
The policy – announced in Monday’s budget – will cost an estimated £1.3 billion pounds next year, money which could instead be used to reverse cuts to Universal Credit or end the benefits freeze a year early.
Leader of the Liberal Democrats Vince Cable said:
“Government is about priorities. With public services desperate for investment, now is not the time to reduce taxes for high earners. Instead Philip Hammond should use the money to further reverse cuts to Universal Credit or end the benefits freeze a year early.
“In Government Liberal Democrats focused tax cuts on lower earning families, and we support continued efforts to do so.
“We encourage Labour MPs who disagree with both front benches about the raising of the higher rate threshold to vote with us against it and put pressure on the Treasury to change course.”
Cuts to Universal Credit’s Work Allowances worth £3 billion pounds a year were announced by the Conservatives in the 2015 Summer Budget, and Monday’s announcement of an additional £1.7 billion only partially undoes them. Meanwhile the benefits freeze could be ended a year early at the cost of £1.5 billion, benefiting an average low-income couple with children by £200 and a single parent by £250.