Public pressure is mounting on the government to increase the personal tax-free allowance to £20,000 in response to ongoing cost of living challenges. As at present, individuals in the UK can earn up to £12,570 per year before incurring any income tax, a threshold frozen until April 2028.
A recently launched public petition has gathered momentum, with tens of thousands of signatures calling on ministers to consider a substantial rise. Supporters argue the measure could ease financial pressures for working families and encourage greater workforce participation.
Background on the Personal Allowance
The personal tax-free allowance sets the amount an individual can earn annually without paying income tax. Since 2021, the threshold has been fixed at £12,570 and is set to remain at this level until at least April 2028, following a government freeze announced during the Spring Budget.
The policy, designed to bolster tax revenues in the wake of fiscal pressures, has attracted both support and criticism amid fluctuating economic conditions and rising household expenses.
Details of the Public Petition
A petition has been submitted urging the government to raise the personal allowance from £12,570 to £20,000. According to the petition, the increase would support individuals facing the escalating costs of essentials such as rent, mortgages, council tax, and energy bills.
The text of the petition states the change could particularly benefit families struggling with the high cost of childcare, which is cited as a barrier preventing some parents from returning to work.
Financial Impact of the Proposed Increase
Supporters of the petition estimate that raising the threshold to £20,000 would result in tax savings of up to £1,486 for basic rate taxpayers earning £20,000 or more annually. For a household with two adults both earning above the threshold, the combined saving could total nearly £2,972 per year.
These figures are calculated using the basic rate of income tax, currently set at 20%. No official government costings have been published for this policy proposal.
Public Response and Support
At the time of writing, the petition calling for the allowance increase has received over 28,000 signatures. Under current parliamentary procedure, any petition that gathers more than 10,000 signatures requires a government response.
Should the petition reach 100,000 signatures, the issue must be considered for debate in Parliament. Many signatories have commented that the current minimum wage and tax burden make it difficult for average families to cover their expenses.
Current Income Tax Structure in the UK
UK income tax is charged at different rates based on income brackets. For 2023/24, income up to £12,570 is tax-free. Earnings between £12,571 and £50,270 are taxed at 20%.
Income from £50,271 to £125,140 is taxed at 40%, and any income above £125,140 is taxed at 45%. Individuals with income above £100,000 see their personal allowance reduced by £1 for every £2 earned over this threshold, with the allowance tapering away entirely at b
Final Summary
The campaign to raise the UK's personal tax-free allowance to £20,000 has gained notable traction, reflecting growing concern over rising living costs and the financial pressures faced by working households.
While advocates highlight the potential benefits for family budgets and workforce participation, the measure would have significant fiscal implications if adopted. As public debate gathers pace, the issue is likely to remain central to wider discussions on tax and economic policy.
For those seeking regular updates on tax policies and personal finance guidance, platforms like Pie provide self-assessment services in the uk.
