Darling hints at pensioner tax-breaks

Date: 4th February 2009

An increased personal allowance for pensioners could be one fiscal measure introduced at this year's budget announcement.

Speaking to a House of Lords select committee, Chancellor Alistair Darling hinted that he was to implement taxation breaks for pensioners hit by low interest rates.

Pensioners presently pay zero taxation on £9,030 of their income, but recent Bank of England base rate cuts have pressurised personal finances for the UK's older generations.

Mr Darling said: "The over-interest of our economy … demands that interest rates are lower rather than higher.

"In relation to pensioners, my predecessor raised the personal allowance for pensioners up to significantly higher levels than non-pensioners."

He added that this was an area he was likely to return to at March's budget statement.

Last month, the chief executive of Barclays told Channel Four News that the government should introduce taxation incentives for savers to balance low interest rates.