Philip Hammond ‘could raise taxes for working families by £130 a year’ in bid to fill Budget black hole and fund NHS
The Chancellor is scratching his head trying to figure out how to pay for the £20billion cash for the NHS Theresa May has promised
PHILIP Hammond could be on track to raise taxes for working families by up to £130 a year by ditching Tory promises to slash income tax.
The Chancellor is scratching his head on how to raise enough money to pay for Theresa May's £20billion NHS injection - and is reportedly eyeing up delaying or even ditching a promised tax cut.
Tories promised in their 2015 election manifesto that they would raise the personal allowance to £12,500 by 2020 - which is the amount Brits have to start to pay tax at.
Last year Mrs May promised to stick to the vow, and said they would keep taxes as low as possible.
But freezing the tax thresholds as they are would save around £2billion for the Treasury's pot.
One source told the Daily Mail: "Everything is on the table now."
They went on: "If you are looking for guidance on tax policy I would not look to the manifesto.
"We will always be a party of low tax. But the Prime Minister’s priorities have changed.
"We have made a huge spending commitment here, which will be transformational for the NHS. But it has to be paid for and the Budget will reflect that."
If put in place it would mean millions of low-paid Brits would continue to pay the higher rate of taxes - costing them £130 a year.
And the higher rate 40p tax rate is also under threat - which if it remained where it was would cost those on higher incomes a whopping £730 a year.
But Treasury sources played down the speculation, and said nothing was signed off yet.
Mr Hammond used his conference speech to again hint that some form of tax rise was on the table.
He said: "If we want the NHS to support our ageing population, that will mean a little more tax to pay for the service".
But Tories warned against Mr Hammond reneging on his promises to low earners.
Tory MP Robert Halfon said: "It is absolutely vital that we are the cutting-the-cost-of-living party, particularly for those on lower incomes.
"That should be our number one priority for government and it is hard to see how you would square that with abandoning this promise."
Income tax threshold changes for lower earners over time
David Cameron and George Osborne announced to increase the personal tax allowance back in 2010 - and it has risen every year ever since:
2010/11: £6,475
2011/12: £7,475
2012/13: £8,105
2013/14: £9,440
2015/16: £10,600
2016/17: £11,000
2017/19: £11,500
2018/19: £11,850
Promised:
By 2020: £12,500
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Earlier this year Mrs May accepted that people would have to "pay a little bit more" to fund more spending for the NHS.
As a 70th birthday gift, the Prime Minister promised to give the struggling service an extra cash infection worth £20billion a year by 2023.
In her conference speech last week Mrs May declared the "end of austerity" was coming - promising to reward hard-pressed Brits for years of savings and cuts.
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