Brown moves to help victims of tax ban abolition

Apr 20 2008 By Rob Gibson

GORDON BROWN is studying ways to ease the pain when the 10p tax band is abolished.

The Prime Minister wants to compensate the 5.3million people earning less than £18,000, who stand to lose up to £232 a year under proposals to cut the basic rate of income tax from 22p to 20p.

He ordered a review after more than 70 Labour MPs threatened to vote against the move. The Treasury are expected to propose changes in child benefits, state pensions and tax credits to make up for any losses.

Brown is said to be "furious" over the scale of the rebellion.

Treasury Secretary Angela Eagle said people should "watch this space" when asked about measures to compensate those hit.

But a Treasury spokesman later said there was no question of "an imminent change to the policy".

SNP Finance Secretary John Swinney has written to Treasury Chief Secretary Yvette Cooper, claiming 500,000 Scots families would be left worse off by the abolition of the rate.