State pensioners are calling for a significant increase in tax thresholds, urging Rachel Reeves to double the current tax-free allowance. This proposal comes as retirees face potential financial strain due to a potential HMRC tax raid. The petition, which has garnered over 54,000 signatures, highlights a pressing issue: the frozen personal allowance of £12,570. As the state pension rises under the triple lock mechanism, more retirees may be drawn into the tax system, despite having modest incomes. The Treasury has acknowledged this problem and plans to address it by 2027, aiming to reduce the administrative burden on pensioners. However, the petition calls for a more radical solution: a new tax code specifically for state pensioners, setting the tax-free threshold at £25,140, double the current personal allowance. This would protect pensioners with small private or workplace pensions from paying income tax while still requiring higher-income pensioners to contribute. The Treasury, however, has rejected this proposal, describing it as 'untargeted and costly'. Despite this, the campaign continues to gain momentum, with the petition passing the halfway point towards the 100,000 signatures required to trigger a parliamentary debate. The issue has sparked concern among personal finance experts, such as Martin Lewis, who has questioned the practicality of the current system and raised the issue directly with the Chancellor. The debate over pensioner tax thresholds highlights the complex balance between financial support for retirees and the fairness of the tax system. As the campaign progresses, it remains to be seen whether the government will heed the call for a separate tax code for state pensioners.
