The Conservatives have thrown down the gauntlet to its rivals by announcing that it will raise the 40 per cent tax threshold from £41,900 to £50,000 if they win the 2015 General Election

This was the promise made by David Cameron at this week’s Conservative Party Conference, a surprise move viewed by political experts as part of a play for votes ahead of next year’s general election.

Currently UK consumers pay a 20 per cent basic rate of tax on the first £31,865 they earn above the personal allowance and then 40 per cent on earnings up to £150,000.

The pledge is in addition to increasing the tax-free personal allowance from £10,500 to £12,500 by 2020.
Cameron said the personal allowance changes would mean one million of the country’s lowest-paid workers do not have to pay income tax at all.

The announcement comes a day after Chancellor George Osborne said he would freeze working age benefits for two years after the election to save £3bn.

The Prime Minister admitted “The 40p tax rate was only supposed to be paid by the most well off people in our country but in the past couple of decades far too many have been dragged into it.”