The demand to increase the income tax personal allowance in Britain has given rise to a new debate. A petition started by Alan David Frost has become the voice of millions of people and has so far received more than 2 lakh signatures. This petition demands from the British government that the current tax-free income limit of £12,570 be increased to £20,000.
This petition has received such a huge response till June 2025 that it is now being considered for debate in Parliament. Let us understand why this demand has arisen, what are the reasons behind it, what will be its impact on society, especially pensioners and common workers, and what has been the government’s response.
Why is there a need to increase the tax free income limit?
In Britain, personal allowance is the income on which a person does not pay income tax. Currently this limit is £12,570 and it is frozen since 2021 – that is, it is not increasing with inflation or salary increase.
This stagnation has created a “fiscal drag”, under which as people’s salary increases a little, they move into a higher tax bracket, and this does not lead to any significant increase in their actual income.
What is the demand in the petition?
The main demand of the petition is that the tax-free income limit be increased to £20,000. Several important arguments have been given behind this:
Relief for low-income earners
This will benefit millions of low-paid employees. Paying less tax will increase their net income i.e. the amount they get in hand and they will be able to become a little financially empowered.
Pensioners will get direct benefit
The pension amount of most elderly people receiving state pension is around this limit. If the tax-free income limit is increased, they will not have to pay any tax, which will give them more convenience at the time of their retirement.
Increase in consumer spending
When people have more money to spend, they will buy more, which will boost the market and can give impetus to the economy.
Dependence on welfare will decrease
If low-income earners get tax relief, they will be less dependent on financial assistance from the government, which can also reduce the pressure on welfare schemes to some extent. What does he or she say, as the government?
The government must act on this petition once 10,000 signatures are obtained and once the figure reaches 100,000 a debate in Parliament must take place. Now that this number has crossed 2 lakh, this issue will be raised seriously in Parliament.
Previous position of the government
The Conservative government has already frozen the personal allowance till 2028. They believe that keeping the tax limit stable keeps the government getting the necessary income, which funds public services (such as NHS, education, security).
But critics say the freeze has increased the tax burden on ordinary people, and that the policy is fuelling inequality.
How does the tax allowance work?
Every citizen does not have to pay tax up to a certain income limit per year – this is called the Personal Tax Allowance.
Some special circumstances:
- The allowance starts to decrease for those earning more than £100,000.
- The tax allowance is reduced by £1 for every £2 of additional income.
If someone’s income is £125,140 or more, their entire tax free limit is gone.
Marriage and couple allowance
You might qualify to receive Marriage Allowance when you are in a marriage or a civil partnership. This enables a person who earns less to give his or her partner up to 1,260 of his or her tax allowance.
You or your partner might qualify to receive Married Couple allowance and this is a special feature that actually lowers your taxes further provided, your or your partners was born prior to 6th April 1935.
What about providing an increase in the tax threshold to a level of 20000?
If the government decides to raise the tax-free income threshold to £20,000, there are several consequences:
Benefits:
- Low-income earners will no longer have to pay any income tax.
- Pensioners’ state pensions could become completely tax-free.
- Middle-class workers will be able to save up to £1,486 in tax per year.
Challenges:
- The government’s tax income could fall by an estimated £40 to £50 billion a year, impacting funding for public services.
- The government may have to increase other taxes such as VAT or National Insurance, which will again put a financial burden on the common man.
- Increasing cash in the market can increase the risk of inflation, which can make essential commodities expensive.
The petition is still open – you can also support
This petition is still open to the general public and can be signed till 20 June 2025. If you also want the government to increase the tax free limit and pensioners get relief, then you can be a part of an important change by supporting this petition.
Conclusion
The demand to increase the tax free income limit in Britain from £12,570 to £20,000 is not just a demand to change a figure, but it is a demand for a change that can directly impact the lives of crores of common citizens, pensioners and low income people. The voice behind this petition has now reached the Parliament. Now it remains to be seen how the government strikes a balance between economic balance and social justice. Will there be a change in tax policy or will this demand of the public also remain unheard – the answer to this will definitely be found in the coming times.
FAQs
1. What is the current income tax personal allowance in the UK?
A. As of 2025, the income tax personal allowance is £12,570. This means individuals can earn up to this amount tax-free.
2. What is the proposed change in the income tax threshold?
A. There is a petition proposing to raise the income tax threshold from £12,570 to £20,000 to reduce the tax burden on pensioners and low earners.
3. Who started the petition to raise the tax threshold?
A. The petition was initiated by Alan David Frost and has gained significant public support.
4. How many people have signed the petition?
A. As of June 2025, over 200,000 individuals have signed the petition, triggering a potential debate in Parliament.
5. How will this change benefit UK state pensioners?
A. Raising the threshold to £20,000 would mean many pensioners wouldn’t have to pay any tax on their state pension, resulting in increased take-home income.
