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MPs revolt over new income tax system

Backbench Labour MPs have criticised the government for scrapping the ten per cent income tax rate, the Guardian reports.

The group signed an early day motion in the Commons, which claimed that low-income families previously covered by the rate will now be left out of pocket.

Under new tax rules to be introduced at the end of this week, the old system of a ten per cent rate for low earners and a 22 per cent basic rate will be streamlined into a flat 20 per cent rate.

In effect, this will mean that people earning over the £5,400 tax-free allowance will be paying more in tax - leaving them with less to pay off credit cards and to pay off debt.

Speaking to the BBC, motion signatory Nia Griffith commented: "It appears that some people are going to miss out.

"I think we all thought that there were going to be tax credits that covered everybody, but in fact there are going to be some people who will have to pay more."

A total of 26 MPs signed the early day motion.

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