The Welsh Conservatives have pledged to cut income tax in Wales by 1p in the pound if elected at next spring’s Senedd Election.
It has calculated that a 1p reduction in the basic rate of income tax would cost a Tory administration in Cardiff Bay around £300m annually in lost tax revenues. However, Welsh Conservative leader Darren Millar said as a result the average working family would be £450 better off.
The party said the reduction - representing just over 1% of the Welsh Government’s total budget of £26bn - would be made up from yet to be defined departmental efficiency savings, although insisting it would not impact the biggest spending areas of health and education. It has also committed to protecting funding for farming.
It said it has no plans to reduce the additional rate of tax at 45% as a way of attracting high net worth individuals into Wales. However, as income tax is progressive the higher the salary the biggest will be the tax saving.
Since 2019 the Welsh Government has had the ability to vary the three income tax bands - the basic, higher and additional rate- up and down by 10p. However, it has declined to do so and maintained the same rates as in England.
Scotland has the ability to create new tax bands. This has seen it introducing a number of new bands, including a top tax of tax of 48% for those earning more than £125,140 and a 19% start rate of tax for those earning between £12,571 and £15,397 in the current tax year. In England and Wales the lowest basic rate starts at 20p and applies to annual incomes ranging from £12,571 up to £50,270.
The Welsh Tories said it wouldn’t seeking powers for the Welsh Government to have the ability to create new tax bands. The current Labour Welsh Government recently announced a review of income tax and powers in Wales, although any changes would require 海角视频 Government approval.
Mr Millar said: “Under Labour, the 海角视频 tax burden is set to hit an all-time high leaving taxpayers paying more but getting less in return. And Welsh Labour has its sights set on increasing this burden further.
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“This situation is totally unacceptable, and that’s why I am pledging today that a future Welsh Conservative Government will take immediate action to cut taxes and put more money into the pockets of hardworking people across the country.
“As part of our bold plans to fix Wales, 1.7 million people will receive a tax cut, with the average working family being £450 per year better off, giving them the choice of where to spend more of their hard-earned money.”
Shadow Welsh Conservative Cabinet Secretary for Finance, Sam Rowlands MS, said:
“The Welsh Labour Government has squandered hundreds of millions on pet projects while our public services and infrastructure in Wales has crumbled.
“A Welsh Conservative Government will ruthlessly root out waste, drive out inefficiency, and deliver better value for money for taxpayers.”