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| Version 0 | Version 1 |
|---|---|
| Ministers face new 10p tax fight | Ministers face new 10p tax fight |
| (about 8 hours later) | |
| The government is facing a fresh challenge from Labour MPs over its abolition of the 10p income tax band. | The government is facing a fresh challenge from Labour MPs over its abolition of the 10p income tax band. |
| Last month, Chancellor Alistair Darling quelled a possible backbench rebellion when he announced a £2.7bn compensation package for those who lost out. | Last month, Chancellor Alistair Darling quelled a possible backbench rebellion when he announced a £2.7bn compensation package for those who lost out. |
| But several MPs are thought to support amendments to the Finance Bill to help 1.1 million people not covered by this. The amendments, by two Labour MPs, are not likely to pass but could get enoughsupport to embarrass the government. | |
| On Saturday, the Commons Treasury select committee criticised the chancellor's compensation package. | On Saturday, the Commons Treasury select committee criticised the chancellor's compensation package. |
| Debate | Debate |
| It said this would make up the losses of most of the 5.3 million affected by the 10p decision, but leave 1.1 million of the poorest workers out of pocket by up to £120 a year. | It said this would make up the losses of most of the 5.3 million affected by the 10p decision, but leave 1.1 million of the poorest workers out of pocket by up to £120 a year. |
| It is unclear whether Speaker Michael Martin will call the amendments, tabled by North-West Leicestershire MP David Taylor and Birmingham Selly Oak MP Lynne Jones, for debate on Tuesday. | It is unclear whether Speaker Michael Martin will call the amendments, tabled by North-West Leicestershire MP David Taylor and Birmingham Selly Oak MP Lynne Jones, for debate on Tuesday. |
| Mr Taylor's amendment - which his office said was signed by 15 other Labour MPs - would introduce a taper mechanism into the £600 increase in personal allowances for income tax offered by the chancellor. | Mr Taylor's amendment - which his office said was signed by 15 other Labour MPs - would introduce a taper mechanism into the £600 increase in personal allowances for income tax offered by the chancellor. |
| This would ensure that all of those who lost out from the 10p change were compensated, it was added. | This would ensure that all of those who lost out from the 10p change were compensated, it was added. |
| Dr Jones's plan would give individuals a choice on whether to opt in or out of the 10p rate, allowing anyone put at a disadvantage by the change to stick with the old rates. | Dr Jones's plan would give individuals a choice on whether to opt in or out of the 10p rate, allowing anyone put at a disadvantage by the change to stick with the old rates. |
| Earlier threat | Earlier threat |
| Downing Street indicated that no further changes were planned to income tax arrangements for this financial year. | Downing Street indicated that no further changes were planned to income tax arrangements for this financial year. |
| Mr Darling will announce his plans for future years in the pre-Budget Report this autumn. | Mr Darling will announce his plans for future years in the pre-Budget Report this autumn. |
| His compensation package was produced after Labour backbenchers had threatened to block the Budget by preventing the Finance Bill passing through Parliament. | His compensation package was produced after Labour backbenchers had threatened to block the Budget by preventing the Finance Bill passing through Parliament. |
| On Saturday, Frank Field, the Labour backbencher who led the rebellion, said: "We will be looking, when we debate this in the Commons, and when the government promises it will come back in November, for a proper settlement for everyone who lost out on 10p." | On Saturday, Frank Field, the Labour backbencher who led the rebellion, said: "We will be looking, when we debate this in the Commons, and when the government promises it will come back in November, for a proper settlement for everyone who lost out on 10p." |
| The decision to scrap the lowest 10p tax rate, made by Gordon Brown in his last Budget as chancellor in 2007, came into force in April this year - alongside a reduction in the basic rate of tax from 22% to 20%. | The decision to scrap the lowest 10p tax rate, made by Gordon Brown in his last Budget as chancellor in 2007, came into force in April this year - alongside a reduction in the basic rate of tax from 22% to 20%. |