U.K. Says Changes to Tax Thresholds to Cost $3.6 Billion
(Bloomberg) -- Philip Hammond’s decision to raise the tax thresholds for lower and high-paid workers a year earlier than expected will cost the government 2.8 billion pounds ($3.6 billion) next year.
The change in the coming fiscal year will cut taxes for 32 million people in the U.K., according to government estimates. A worker will be able to earn 12,500 pounds before paying income tax and earn 50,000 pounds before they pay the higher rate of tax, which currently stands at 40 percent.
The decision will cost the U.K. 6.17 billion pounds in the first three years. The tax cuts kick in from April 2019.
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