Tax bills for thousands of Fife families slashed in half under plans put forward by Lib Dems

12.41.00pm GMT Sat 19th Dec 2009

Over 5,000 residents in Dunfermline and West Fife will have their tax bills slashed by at least half under proposals announced by the Liberal Democrats, which have been welcomed by local MP Willie Rennie as a “radical plan” to make Britain’s tax system fairer.

The Liberal Democrats have proposed raising the income tax personal allowance threshold to £10,000, which would mean that 4 million low paid workers and pensioners would no longer have to pay any income tax. The move would also give back £700 to tens of millions of people on low and middle incomes, cutting in half the tax bills of thousands of families in Fife.

This tax shift would be paid for by closing tax loopholes and privileges enjoyed by the rich, bringing an end to the big differential between top rate income and capital gains tax and scrapping the exceptionally generous tax relief on large pension pots.

Commenting Mr Rennie said:

“Families on low and middle incomes shouldn’t be the ones bearing the burden of Britain’s spectacularly unfair tax system. But under this Labour Government, Fife’s poorest pay more tax as a share of their income than the richest.

“The Liberal Democrats are the only party with a radical plan to make the tax system fairer that will put hundreds of pounds into the pockets of thousands of Fifers.

“By making the first £10,000 that people earn tax free, the Liberal Democrats will shift the burden of the tax system away from those who cannot afford to pay onto those who can.

“This will mean 5,000 people in the Kingdom will have their tax bills slashed in half while thousands more low and middle income families will receive an extra £700 a year”.