Response given with one-week deadline on £20,000 private tax allowance change | Personal Finance | Finance | EUROtoday

A petition calling on the UK Government to extend the non-public tax allowance to £20,000 from its present degree of £12,570 has one week remaining to collect ample signatures to be thought-about for Parliamentary debate. The petition, established on the UK Government’s petition web site by Shannon Keene, has a deadline of Saturday, February 28, 2026.

Titled ‘Raise the revenue tax private allowance from £12,570 to £20,000’, it states: “This would help with increasing rent, mortgages, Council tax, and Gas and Electric bills. Some families can’t afford to go back to work after children due to childcare costs wiping their whole income!

“We assume that we’re at present paying ridiculous quantities of tax, and that minimal wage is not even sufficient to assist a median household. We consider that this is able to lead to an enormous enhance on individuals prepared to search for work, as an alternative of individuals not eager to, as a result of it being too costly to now stay.”

At present, workers can earn £12,570 annually before they begin paying income tax – a threshold known as the personal tax allowance. Income beyond this level is then subject to 20 per cent tax on earnings up to £50,270. Beyond that level, income is taxed at 40 per cent. Earnings exceeding £125,140 attract 45 per cent.

In the budget of last November, Chancellor Rachel Reeves decided to prolong the existing income tax freeze, initially set by a Conservative government Budget in 2021, beyond its initial 2028 deadline until 2031. This means that there will be no alterations for another five years as it currently stands.

This strategy can boost the Government’s revenue as it pulls more individuals into the tax bracket, or a higher tax bracket, as salaries rise but the allowance remains static.

As of Saturday afternoon when this was written, the petition had amassed 73,106 signatures. To be considered for a debate in Parliament, it needs to reach 100,000 before next Saturday’s deadline.

However, since the petition has surpassed 10,000 signatures, the Government is obliged to respond, which it did prior to the November 2025 Budget.

A spokesperson for HM Treasury responded: “The Government is dedicated to maintaining taxes for working individuals as little as doable whereas investing in public companies and never taking dangers with the financial system. The Government at present has no plans to extend the Personal Allowance to £20,000.

“Increasing the Personal Allowance to £20,000 would come at a significant fiscal cost of more than £50 billion per annum. This would reduce tax receipts substantially, decreasing funds available for the UK’s hospitals, schools, and other essential public services that we all rely on. A £50 billion cut in public services is equivalent to slashing roughly a quarter of the NHS Budget, or around 80% of defence spending.

“To assist the lowest-paid staff in our financial system, the Government requested the Low Pay Commission to account for the price of dwelling when making their suggestions on the minimal wage charges to use from April 2025, for the primary time. The authorities can be supporting households by the common supply of 15 hours of government-funded childcare for all dad and mom of 3- and 4-year-olds and eligible working dad and mom of kids aged 9 months and above can entry 30 hours every week in free childcare.

“The Government keeps all taxes under review as part of the policy making process. The Chancellor will announce any changes to the tax system at the Budget on the 26th November in the usual way.”