Will raising the personal allowance pay off?

Will raising the personal allowance pay off?

No other policy received more pre-budget attention than the increase of the personal allowance. With debate other whether it is a Tory or Lib Dem policy some have argued instead for a rise in the 40% threshold to take more earners out of the top income tax bracket.

imageFrom research we carried out during the budget, we found that sticking to raising the personal allowance might have been a shrewd move after all. Almost half (47%) thought the Chancellor should prioritise increasing the personal allowance, while only 14% thought he should have prioritised raising the 40% threshold.

There are clear differences amongst income groups: only one in ten (11%) of those in the basic rate bracket thought raising the 40p threshold should be the Chancellor’s priority, compared to a third (33%) of those in the higher bracket. However, half (50%) of those earning more than £40,000 still thought the Chancellor should prioritise the personal allowance.

Out of the three major parties, the voters that seem to most support raising the personal allowance instead of the 40p threshold are Conservatives (58% to 16%), while only 46% and 48% of Labour and Lib Dem voters respectively think the personal allowance change should be put first.

Opinium Research carried out an online survey of 2,001 UK adults aged 18+ from 18th to 21st March 2014. Results have been weighted to nationally representative criteria.