Reform UK to increase tax threshold to £20000 to help those on benefits. Confused.

Wonderman

Hey all

There's something that's been bothering me.

Nigel Farage claims that people who work more than 16 hours a week are worse off and staying on benefits is better which is true in some circumstances.

But how is increasing the tax threshold to £20000 going to help them?

The most I've been taxed a week is £50 and that was when I was on emergency tax and then it was £20 a week on 21 hours a week. There's already a tax threshold and most part time workers don't come close to it.

Also the working under 16 hours rule and it affects your benefits only applies to legacy benefits... I thought Universal credit wasn't about the hours, but the money you earn and you get a threshold which is £300 something.

I'm confused.

Is Nigel farage talking through his but?

Thanks. Hope someone can help me understand this lol. I have disabilities so it's quite difficult.

MW123

@Wonderman

While Nigel Farage's suggestion that all low-income earners, including part-time workers, would significantly benefit from an increased threshold may be an oversimplification, part-time workers earning below the current threshold of £12,570 are already exempt from income tax. Consequently, raising the threshold to £20,000 would have minimal direct impact on this group, unless individuals in this category take on an additional job where their combined earnings fall below the proposed £20,000 threshold.

Farage's assertion that individuals working more than 16 hours per week might be financially disadvantaged compared to those receiving benefits can indeed be valid in certain circumstances. By elevating the tax-free threshold, employees would retain a larger portion of their earnings before taxation, potentially making employment more financially rewarding. This could serve to mitigate the perceived advantages of remaining on benefits for some individuals.

The primary objective of increasing the tax threshold is to reduce financial disincentives for work and potentially improve the economic situation for low-income earners. Such a policy aims to create a more favourable balance between employment income and welfare benefits, encouraging workforce participation and economic self-sufficiency.

A £20,000 tax-free threshold would likely be welcomed by a substantial portion of the workforce nationwide, myself included. However, a comprehensive analysis of the economic implications, including the impact on government revenue and potential effects on public services, would be necessary to fully evaluate the merits of such a proposal.