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'Adventurous' plan to lift low paid from tax net

 

This year's Budget contains plans for far-reaching changes to the Island's taxation regime in future.

In what's described as 'one of the most adventurous steps for many years', Eddie Teare has laid out plans for a substantial rise in personal tax allowance in the financial year starting 2016.

The move is designed to take thousands of the lowest paid workers out of the income tax net altogether and would result in a single 20% higher rate of tax for all earning over the raised threshold. 

Mr Teare acknowledged government had gone as far as it could imposing charges on the public, as any further pressure on squeezed incomes could prove counter-productive.

The government's own figures show that the poorest 25% of the working population do not earn enough to cover their outgoings, with many claiming benefits or taking on additional jobs to make ends meet.

Tynwald must vote in favour of today's Budget for the reform to proceed - and proposals to change the current taxation regime would be subject to consultation. 

Mr Teare said it's an idea which provides a clear incentive to work:

 

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