Raise the standard tax-free Personal Allowance to £45,000

The Personal Allowance is the amount of income a person can get before they pay tax. It stands at £12,570 in 2024. We would like the standard Personal Allowance raised to what we think is a more realistic figure of £45,000.

The previous Government made the decision to freeze the income tax Personal Allowance (PA) at its current level of £12,570 until April 2028. The current Government is committed to keeping taxes for working people as low as possible while ensuring fiscal responsibility and so, at our first Budget, we decided not to extend the freeze on personal tax thresholds. As a result, they will rise with inflation from April 2028, meaning working people will keep more of their earnings.

The Government has no plans to increase the Personal Allowance to £45,000. Increasing the Personal Allowance to £45,000 would come at a significant fiscal cost of many tens of billions of pounds per annum. This would reduce tax receipts substantially, decreasing funds available for the UK’s hospitals, schools, and other essential public services that we all rely on. It would also undermine the work the Chancellor has done to restore fiscal responsibility and economic stability, which are critical to getting our economy growing and keeping taxes, inflation, and mortgages as low as possible.

The Government keeps all taxes under review as part of the policy making process. The Chancellor will announce any changes to the tax system at fiscal events in the usual way.

HM Treasury

This is a revised response. The Petitions Committee requested a response which more directly addressed the request of the petition. You can find the original response towards the bottom of the petition page (Raise the standard tax-free Personal Allowance to £45,000)