Top rate of income tax to be reduced to 45 pence per pound

Top rate of income tax to be reduced to 45 pence per poundThe authorities in the UK are implementing a cut in the top rate on income tax from 50 pence in the pound to 45 pence.

Chancellor George Osborne has announced the reduction in the highest level of income tax as part of the 2012 Budget. The reduction will benefit people earning more than £150,000 in the country. The government will also implement other tax and benefit changes including a freeze on the level of income that pensioners can earn before taxes are imposed on them, from 6 April.

Shadow Chancellor Ed said that the move is giving away cash to the rich in the country. He pointed out that as a result, working families would be shelling out £4,000 more in taxes while millionaires will get an average tax cuts of £100,000 after the proposals are implemented.

The pensioners will not see the amount they can earn without paying tax rise with inflation from today. The tax allowance level for people aged 65 and older has been frozen at £10,500 by the government in the UK. The amount people can earn before paying income tax has risen to £9,440, which would leave an extra £267 a year with the millions of taxpayers.

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