Treasury Rejects £18,000 Tax Threshold Amidst Rising Public Anger

The Treasury has outright rejected pleas to raise the personal income tax allowance to £18,000, confirming it has “no plans” to do so. This comes as a petition demanding the change surged past 15,000 signatures, forcing an official government response, as reported by the Daily Express Politics.

This rejection means the current £12,570 threshold, frozen until 2031 by Chancellor Rachel Reeves, will continue to drag more Britons into paying tax. The freeze, originally set by the previous government until 2028, was extended, resulting in what the Office for Budget Responsibility estimates will raise over £55 billion by 2030/31.

The Treasury’s response stated, “The Government currently has no plans to increase the Personal Allowance to £18,000. Increasing the Personal Allowance to £18,000 would come at a significant fiscal cost of over £40 billion per year.” They also claimed such a move “would also benefit higher earners more than basic-rate taxpayers on average.”

For ordinary families, this means a continued squeeze. A full-time worker on the minimum wage will pay an extra £137 a year by 2030, according to the Guardian. The Resolution Foundation predicts working-age households will be approximately £500 worse off on average this year due to these frozen thresholds, with the bottom 10 per cent of earners bearing the brunt.

The public discontent is clear, with previous petitions for a £20,000 threshold amassing hundreds of thousands of signatures. The current petition now needs to reach 100,000 signatures to trigger a parliamentary debate, which would force ministers to publicly defend freezing the allowance for another seven years while the cost of living continues to bite.