Abolishing the 10p Tax band could send pensioners beyond the poverty line.

30/04/2008

RPI does not appear to be a true reflection of inflation, particularly not for pensioners and those on fixed incomes. To people on fixed incomes, inflation is running at a much higher rate because of what is affecting our pockets more than any other class in society is the rising costs of utilities, council rates, fuel, water rates, food, gas & electricity and the like and should not include the reduction in the cost of flat screen televisions.

I have recently received an increase in my Company Pension which equates to a 2.62% increase on last year. However when taking into account the loss of the 10p Tax Allowance Band this increase effectively nets down to 0.988% and therefore will hardly be adequate to cope with the increase in the cost of living.

Once again this current Government have let pensioners down but I understand they are now embarking on a scheme to rectify the apparent mess they find themselves in following adverse public opinion on the abolishment of the 10p Tax band. The whole saga is becoming far too complicated & expensive to administer.

RPI used to be a reliable measure of true inflation but I really believe there has to be another way to treat pensioners if they are to beat the inevitable poverty line. Perhaps one method would be not to tax pensions at all. We certainly don't want to fill in any more forms or get means tested for our money. You can live and dream.

Mike

Enfield