North Swindon MP Welcomes News Local Residents Will Benefit From Tax Changes

Millions of people across the country are set to benefit from changes to the tax system which came into force this week.

The National Living Wage has increased to £8.21 an hour, almost a 5% increase and the largest increase since it was introduced in 2015. The rise will see the incomes of 1.8 million people increase by £690 a year. Full-time workers receiving National Living Wage are now more than £2,750 better off a year compared to 2015.

In addition to this, the National Minimum Wage is also increasing – rising to £7.70 for 21 to 24-year olds, £6.15 for 18 to 20-year olds, £4.35 for 16 to 17-year olds and £3.90 for apprentices. In all, 5 million people will directly or indirectly benefit from increases to the National Living Wage and National Minimum Wage – with 2.1m workers benefitting directly.

Taxpayers will also be able to keep more of what they earn as an increase to the Personal Allowance comes into effect. The Personal Allowance -  the amount you can earn each year without paying income tax – is to rise by £650 to £12,500. These changes will cut taxes for 32 million people, including 105,000 in Swindon.

Working parents and disabled people in receipt of Universal Credit will be able to earn an extra £1,000 a year before the amount they are entitled to starts to reduce. This change will see 2.4 million families keep up to an extra £630 per year of what they earn.

Fuel duty has been frozen for the ninth successive year. By next April, this will have saved the average car driver a cumulative £1,000. Most other vehicle taxes are being uprated in the normal way in line with previously announced policy.

Funding for the The New Enterprise Allowance (NEA) will continue for another 2 years with 30,000 new mentoring places available. The New Enterprise Allowance provides mentoring, support and funding for people in receipt of benefits to get their business ideas off the ground. So far over 120,000 businesses have been launched though the NEA since 2011.

The amount people can claim for additional support in the workplace through the Access to Work Scheme is increasing by an extra £2,000 per year. People are now able to claim up to £59,200 annually through the scheme to help pay for additional support that they may need, such as workplace adaptations, assistive technology, transport and interpreters.

Small retailers will benefit from a third off their business rates bills, this is part of more than £13 billion of rates relief since 2016. To further reduce costs, business rates have been uprated in line with CPI rather than RPI, following the permanent switch in April 2018.

To support business investment, we have introduced a major new Structures and Buildings Allowance and a temporary increase in the Annual Investment Allowance to £1 million. Capital allowances special rate will decrease from 8% to 6% to more closely match average accounts depreciation.

Justin Tomlinson MP said: “The Government is determined to ensure that workers receive a far wage for their work, and the increases in National Living Wage and National Minimum Wage ensures this.  Our minimum wage rates are among the highest in the world, and our modern Industrial Strategy will continue to protect the UK’s workers.”