The Adam Smith Institute’s Research Director, Sam Bowman, was quoted in The Mail Online, supporting the Prime Minister’s pledge to cut taxes for low-income workers.
The changes were welcomed by tax campaigners. Sam Bowman, research director of the Adam Smith Institute, said: ‘It’s great news that the Prime Minister has pledged to raise the tax-free personal allowance to £12,500. Tax cuts for the poor are one of the best ways to help beat poverty in Britain.
‘Taking minimum wage workers out of tax is a way of giving workers a ‘Living Wage’ without risking jobs. The difference between the Living Wage and the minimum wage is entirely tax – if we stopped taxing minimum wage workers, they would earn the equivalent to a post-tax Living Wage. ‘
Mr Bowman said more could still be done, including easing the burden of National Insurance, which works in a different but similar way to income tax and in effect adds 12 per cent to the tax most workers pay.
He said: ‘National Insurance contributions are just another form of income tax and are not affected by this threshold rise. Raising that threshold and pegging the new NI and income tax thresholds to the minimum wage rate should be the next government’s top priority to beat the scourge of low pay once and for all.’
A further tax-cutting commitment was given on business tax, with the Prime Minister promising that the UK would ‘always have the most competitive corporate taxes in the G20′.
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