Increasing the number of very high earners whose income relief is cut further is another option being considered, the report said…reports Asian Lite News
Chancellor Jeremy Hunt is considering changing income tax rules which are designed to encourage workers to save into their pension pots, the Telegraph reported.
Talks are underway to reduce the rate at which income tax relief is applied to Britain’s higher-rate taxpayers from 40 pence to as low as 20 pence, according to the Telegraph. Increasing the number of very high earners whose income relief is cut further is another option being considered, the report said.
The total cost of pension tax relief to the Exchequer is £42.7 billion, of which £22.9 billion is relief on income tax. A flat rate of 20% would raise between £8 billion to £10 billion a year, according to a report by the Pension and Lifetime Savings Association.
It marks the resurrection of a plan first pitched by former chancellor George Osborne in 2016, which was abandoned by the Conservative Party. The Telegraph last week reported that Osborne had been approached by Hunt for advice on how to handle Britain’s economy.