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Ukip to push for flat-rate income tax and £13K transferable personal allowance

Godfrey-Bloom-MEP-UKIP-700x450.jpg
MEP Godfrey Bloom

The UK Independence Party is considering proposing a radical shake-up of personal taxation by scrapping all National Insurance contributions while introducing a transferable personal allowance and a flat-rate income tax of 25 per cent.

However, experts warn the plans could cost £100bn and are based on “back-of-the-envelope” figures.

University of Georgia economics professor David Kamerschen and MEP Godfrey Bloom have drawn up proposals that will be voted on at Ukip’s national executive committee meeting on 27 June.If accepted, they will become official party policy.

The plan includes a more generous personal allowance of £13,000 per person that could also be transferred to a spouse. The personal allowance is currently £9,440 and will rise to £10,000 next April. It is non-transferrable.

The Ukip plan means someone whose husband or wife does not work will earn the first £26,000 tax-free. For pensioners, the personal allowance would be £15,000 and also transferable to a spouse.

Bloom says the reforms would be “revenue neutral” and partly paid for by saving £50bn a year with a “bonfire of the quangos”, £12bn a year by stopping overseas aid and another £12bn by leaving the EU.

He says: “With 30 per cent youth employment, I cannot think of a more lunatic asylum way of fixing it than with a National Insurance employment tax. Most highly paid people would pay 25 per cent income tax because it is not worth the trouble of trying to avoid it so it would raise revenue. If you have a 40 per cent tax rate, people won’t accept it and will set up an avoidance scheme.”

Association of Chartered Certified Accountants head of taxation Chas Roy-Chowdhury estimates the tax reforms would cost more than £100bn.

He says: “It looks like back-of-the-envelope figures. We are always looking for simplicity in the tax system but there needs to be much more detail to underline it rather than broadbrush figures.”

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Comments

There are 17 comments at the moment, we would love to hear your opinion too.

  1. No argument from me regarding Employer’s NI. It has to be the most ill conceived tax ever devised. However, for all their free-market rhetoric, UKIP are at heart a little Englander protectionist party.

  2. Well it looks to be a very sensible idea to me !

    We all know the tax system in this country is a nightmare and all every CE does at budget day is reduce one part and increase another resulting in winners and losers depending on where they think they need to win votes, the end result no real change ? and lots of bolt on’s (NI, VAT, fuel tax the list goes on)

    KISS is the phrase I believe

  3. Having read the UKIP manifesto I was surprised by some of their ideas. Cannot say I want withdrawal from the EU (maybe a better trade agreement no more) but the ideas in their really stuck a cord and I would strongly recommend anyone to look it over. After some thought I would have to admit I would consider voting for them if they can become more mainstream.

  4. michael brayne 31st May 2013 at 10:03 am

    Europe is great, just ask Lord and Lady Kinnock.

    UKIP is mainstream and it speaks for the people, the other parties are now trying to adopt some of their policies.

  5. Typical useless un-thought out policies from a one policy party.

  6. James Marchant 31st May 2013 at 10:27 am

    UKIP has a lot of very sensible policies if you care to look rather than listening to left wing biased media organsiations such as the BBC. They also have people who speak for them who know what they are talking about, for example a former RAF Tornado pilot who speaks on defence.

    Give me straight talking over the cosy metropolitan elite and their cosy public school cliques any day of the week!

  7. ‘One policy party’ – you need to reread the article.

    Looks like Mr Farage is rattling a few cages, which is long overdue.

    Whether they are mainstream or not is debatable, but no doubt they are attracting voters who are sick of the same old 3 party politics, run by career politicians with their noses in the trough.

  8. @ James Marchant.

    ‘Putting the experts in charge’, means, when you think about it, excusing government employees from having to answer directly to the rest of us through our elected tribunes.

    We all have our prejudices and assumptions, the ‘expert’ more than most if by ‘expert’ we mean someone who has spent his entire career in a particular field.

  9. paolo standerwick 31st May 2013 at 11:11 am

    Europe, Quangos, over regulations, complex tax systems and beaurocracy is promoted by the slimy politicians to keep them in power.

    We need a fresh approach to this broken system. UKIP will get my vote from now on.

  10. UKIP will disappear into obscurity, but their lasting legacy will have been to realign the mainstream parties with the feelings of then general public once again, which is not a bad legacy.

  11. I have up to recently been a life long conservative voter but since call me Dave has been leader I have increasingly felt taken for granted.

    I now feel that to all of the mainstream parties I am just a taxation cash cow to be milked.

    I too have taken time to read UKIP’s policies and together with the one in this article they are eminently sensible.

    They will definitely be getting my vote at the Euro and General elections to come.

    Plus unlike labour, Libdems and Cons they do not call you names if you happen to hold views contrary to those held by the elitist chattering classes establishment.

    To me UKIP are now the only true voice of the people.

  12. If you have read the UKIP manefesto and think it makes any sense, you need to review your rationale.

    The proposed cuts to taxation would cripple our already fragile economy. The numbers they quote (in the limited times they actually quote numbers) are selected to show one side of the story (thier side).They focus on issues that in the grand scheme of things are irrelevent but they position them as if they are critical. They want to expand and spend heavily on defence (alarm bells should be ringing) but fail to outline any real detail on critical services such as the NHS and Education. Thier manefesto and this tax proposal should sit firmly in the ‘fiction’ section as it simply would not be workable in practice.

    I agree that the major parties are incapable of running the country effectively but UKIP would destroy it.

  13. Being a liberal (not a Lib Dem) and a floating voter based on stated policies alone, thus may be the first thing I agree with UKIP on. I would like to see NI scrapped for employers, a higher personal allowance and for it to be transferable. It would reduce pressure on HMRC I suspect to recover miniscule tax amounts at more cost to the taxpayer in time and money than it recovers.

    As to “looks like back of the fag packet figures” isn’t that the ONLY figures the critic can have used if he has just read them and commented!

    I rarely stick up for UKIP, but let’s debate sensible please.

  14. 25% flat rate, YOU WANT ME TO WORK TILL I AM DEAD AND GIVE YOU A QUARTER OF ALL I WORK FOR. You politicians think you have the answers to everything and the answer to everything seems to be how much money you can get away with taking off us “legally”. Yes government needs funding but you keep making it bigger and bigger and much more complex than is necessary and the costs keep rising. You people truly are quite insane if you think you can just take and take if its “legal” and dont give the excuse that you want to reduce the amount spent by us because if that were true you would reduce it to no more than 10% of all earnings. You people ever wonder why there are those of us who are seriously considering just finding a suitable cave or abandoned building just so we can afford to eat. I am certainly angry and frustrated enough to be quite offensive but was raised better than that by a man who worked himself to death to keep you lot in business. WELL NO MORE.

  15. Mainstream mucked it up. Money, their own, and Power to the Person! UKIP: clear spring fresh common sense – at last – just in time! nc13Jun13

  16. Geoffrey Bloom talks a lot of sense. His views reflect those of most of the people I speak to and by extrapolation, millions of voters. He’s produced a massive boost to UKIP and I hope that common sense and not political correctness will prevail in UKIP

  17. Sounds like the numbers hang on getting the super-rich who don’t pay taxes now to start paying because the rate is lower.

    HA HA HA HA HA HA HA HA HA HA HA

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