Response given with one-week deadline on £20,000 personal tax allowance change | Personal Finance | Finance
Chancellor Rachel Reeves extended the income tax freeze at November’s Budget (Image: HENRY NICHOLLS, AFP via Getty Images)
A petition calling on the UK Government to increase the personal tax allowance to £20,000 from its current level of £12,570 has one week remaining to gather sufficient signatures to be considered for Parliamentary debate. The petition, established on the UK Government’s petition website by Shannon Keene, has a deadline of Saturday, February 28, 2026.
Titled ‘Raise the income tax personal 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 think that we are currently paying ridiculous amounts of tax, and that minimum wage isn’t even enough to support an average family. We believe that this would lead to a massive increase on people willing to look for work, instead of people not wanting to, due to it being too expensive to now live.”
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.
Chancellor Rachel Reeves speaks to members of staff during a visit to a Sainsbury’s store earlier this week (Image: Alishia Abodunde, Getty Images)
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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 committed to keeping taxes for working people as low as possible while investing in public services and not taking risks with the economy. The Government currently has no plans to increase 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 support the lowest-paid workers in our economy, the Government asked the Low Pay Commission to account for the cost of living when making their recommendations on the minimum wage rates to apply from April 2025, for the first time. The government is also supporting families through the universal offer of 15 hours of government-funded childcare for all parents of 3- and 4-year-olds and eligible working parents of children aged 9 months and above can access 30 hours a 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.”
