Reform UK has announced a pledge to raise the tax-free personal allowance to £15,000 within the first 100 days of winning the next general election. Robert Jenrick, who would serve as Chancellor in a Reform government, stated the proposal aims to alleviate the tax burden on millions of British workers.
The personal allowance, the amount an individual can earn before paying income tax, has been frozen at £12,570 since 2021. Current government plans extend this freeze until 2031, a move critics have labeled a 'stealth raid' on taxpayers. Reform UK estimates that increasing the allowance to £15,000 would save most taxpayers approximately £500 per year, benefiting around 40 million people and potentially removing 2.9 million individuals from income tax altogether.
The party highlighted that the freeze in personal allowance and income tax thresholds, a phenomenon known as 'fiscal drag,' has progressively drawn more people into the tax system. Both Labour and Conservative administrations have faced accusations of implementing 'stealth taxes' by not aligning these thresholds with wage growth, particularly during the cost-of-living crisis. Jenrick asserted that the continued freeze since 2021 has effectively lowered the personal allowance by £3,500 compared to what it would be if it had kept pace with earnings.
Reform UK projects the cost of this tax cut to the Treasury to be £17.7 billion in the first year, increasing to £21 billion by the fifth year of a potential parliamentary term. The party intends to fund this measure through £80 billion in government spending reductions, targeting welfare, Net Zero initiatives, and the foreign aid budget.
Jenrick is also expected to challenge Prime Minister Andy Burnham to match Reform's pledge, framing the choice as prioritizing "the British worker" over "welfare waste, foreign aid and migrants."
At the 2024 general election, Reform UK had promised a personal allowance increase to £20,000. Jenrick indicated this remains the party's long-term objective, stating it would be pursued incrementally once fully funded. The announcement was made during Reform UK's conference in Birmingham, an event that had been preceded by a dispute over political donations.