Conservative Calls to Cut Taxes for Pensioners and Savers!

The Conservatives today called on Gordon Brown to cut taxes for savers and pensioners in the Budget, paid for by slower growth in public spending.

The package is designed to help the innocent victims of Labour’s recession and over the long term, build a savings culture by ending Britain’s addiction to debt under Gordon Brown.

Under the Conservative plans:

•        The 10p starting rate and the 20p basic rate of tax on savings would be reduced to zero – so basic rate tax payers would pay no tax at all on income from savings, benefiting them by up to £7,200 a year.

•        Age related personal allowances for those aged 65 or above would be increased by £2,000, benefiting them by up to £400 a year.

The package would be paid for by reducing the total real growth rate of government spending in 2009-10 from 3.4% to 2.6%.

David Cameron said:

“It is time for change.  Today, I am setting out two vital changes that need to be made right now. The Government should include them in this year’s budget. 

“In order to help deal with Labour’s Debt Crisis and help turn Britain from a spend, spend, spend society into a save, save, save society it is time to abolish income tax on savings for everyone on the basic rate of tax, with top rate taxpayers continuing to pay the same and it is time to raise the tax allowance for pensioners by £2,000.

“We would pay for this change by restricting the growth of public spending in the coming year 2009/10. While the government has cut back its spending plans from 2010 onwards, so far it has left its 2009 spending plans untouched.

“I believe this is wrong.  The time to start being prudent is now.  Why?  Because by doing so we can help the victims of Labour’s recession and help build the long term strength of the economy. These two proposals would be more than paid for by maintaining the government’s spending plans for the NHS, schools, defence and International development, but restricting other departments to a 1 per cent increase in real terms. A culture of thrift at the heart of government, and a culture of saving at the heart of our economy: these changes will provide strong foundations for the new economy we plan to build.”