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Boris Johnson promises to slash income tax for high earners

Spring Statement Houses of Parliament with AbacusFormer foreign secretary Boris Johnson has pledged to almost double the threshold at which the 40 per cent tax rate threshold kicks in if he becomes prime minister.

As part of his bid to become leader of the Conservative Party, Johnson has told the Telegraph that he intends to raise the higher rate threshold from £50,000 to £80,000.

This move is estimated to cost nearly £10bn a year in lost revenues, which Johnson says he will fund from money currently set aside for a no-deal Brexit, and possibly through increasing employee national insurance payments.

The move could reduce income tax liabilities for around £3m people.

The latest news, views and analysis on taxation from Money Marketing

Johnson tells the Telegraph: “We should be raising thresholds of income tax so that we help the huge numbers that have been captured in the higher rate by fiscal drag.”

The first ballot of MPs to decide who will become prime minister is due later this week.

Few parliamentarians have declared their allegiance as yet, but a number of prominent figures have said which candidates they will be backing.

Work and pensions secretary Amber Rudd will support foreign secretary Jeremy Hunt’s campaign, telling the Times that “these are serious times and we need a respected statesman who Brussels will listen to, not more bluster.”

Scottish Conservative Party leader Ruth Davidson is supporting home secretary Sajid Javid’s bid, alongside other ministers including Caroline Nokes and Victoria Atkins.

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Comments

There are 11 comments at the moment, we would love to hear your opinion too.

  1. This is Johnson’s way of rewarding the most vulnerable in society, for suffering nearly a decade of austerity. Give more money to higher rate tax payers. Great for most of us IFAs but it’s hardly fair, is it?

    • Not really great for most IFAs if they are directors or employees because he intends to finance it by raising employees’ class 1 NICs threshold. So he gives with one hand and takes away – more – with the other. Investment income recipients and elderly employees will not be hit by the NICs. Cynical incompetence – it won’t get through this parliament though.

  2. “Johnson has told the Telegraph that he intends to raise the higher rate threshold from £50,000 to £80,000. This move is estimated to cost nearly £10bn a year in lost revenues.”

    Will this be in addition to the £350m a week he pledged to the NHS?

  3. The man is a narcissistic self-interested bully. Hardly surprising he chooses to feather the nests of his high-earning cronies.

  4. Notwithstanding the parliamentary arithmetic problem, I couldn’t quite get my head around the maths. Income tax would be cut but that income band would then be subject to NI. It is already subject to NI, so he can’t mean the 2% rate. So it will be the 12% rate, meaning the net tax reduction to the wage earner is 8%. OK so far, but then the employer must then pay 13.8%.

    That means there is a net tax gain for the Treasury and in the short run, industry is shafted, and in the long run, wages will get screwed down.

    So either Boris has applied his extensive knowledge of classics to the maths and got 5; or he’s going to make the whole tax system even more complex with yet another tax band.

    This really is just a tax cut for a handful of uber-superannuated pensioners.

    Having dodged the limelight for fear of a faux pas, the one time he opens his mouth…

  5. His plan to bridge the gap with the money currently set aside for a no-deal Brexit will come unstuck if he fails to fulfil his ambition to secure a deal where Theresa May has failed. FWIW, I think she’s done her best but should have said to the EU negotiators: This is the deal, OUR deal not yours, and you can take it or leave it. You choose.

    Then again, if no deal is forthcoming, we’ll save £39Bn so I suppose he’ll be able to deploy some of that instead.

    • We won’t save £39billion as a lot of that amount is our pre agreed obligations. Unless we want to renege on our legal obligations. It would not surprise me if the numpties in charge of our country don’t care about our international reputation having said that.

  6. Surely, he couldn’t be trying to bribe those Tory party members who happen to be pensioners on over £50k a year, could he?

    Having failed to get him for Misconduct in a Public Office, what are the chances of getting Johnson under anti-bribery legislation?

  7. Who will believe anything this serial liar says? Only the most gullible. Anyway it isn’t over till the fat lady sings and it is not 100% certain that he will be the leader of the dying party.

  8. Jeremy Corbyn will be ecstatic about this announcement.

    By all accounts the number of under 35’s who vote Conservative are small. Tax policies like this will exacerbate that.

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