Andy Burnham higher HMRC income tax band for three million workers

Three million workers are set to become higher-rate taxpayers by 2027, according to HMRC figures. Marianna Hunt, Personal Finance Expert at Fidelity International, said: "These figures show just how dramatically the tax landscape has changed in recent years The number of higher-rate taxpayers has risen from around 4.43 million in 2021 22 to a projected 7.7 million in 2026 27 - an increase of 3.27 million people 74% in just five years."

The frozen personal allowance at 12 570 since April 2021 has created fiscal drag, pulling more workers into higher tax bands despite legislation requiring it to rise with inflation.

Mr Burnham acknowledged this issue during his campaign, telling The Times the frozen allowance was "the thing I heard the most on the doorsteps in Makerfield" adding it "had become lodged in my mind." However, he has stepped back from making raising the allowance a priority.

Marianna Hunt stated: "Higher-rate taxpayers are no longer a small group of top earners Because of frozen tax thresholds millions of workers bringing home what probably feels like a relatively normal income are now paying rates of tax that would once have been reserved for much higher earners."

Jonathan Cribb, deputy director at the Institute for Fiscal Studies, outlined two long-term options: "raising the 12 570 threshold for all earners or limiting the increase solely to state pensioners." He warned: "Unless you have an extremely low income you can't avoid these tax rises."

The matter becomes pressing next April when the state pension will exceed the 12 570 threshold, forcing pensioners to pay income tax on state pension income.