After Brown's tax u-turn...

Step Up Fight Against Low Pay!

Gordon Brown, photo Suz

The abolition of the 10p tax rate (the hiking of income tax for those earning less than £18,500 a year) has become a powerful symbol of the contempt this government has for working people.

Tom Penman Dundee, Scotland

A 20-year old without children on £10,000 was made £109.96 a year worse off, and other low paid workers lost up to £232 a year!

While food and utility bills soar, wage increases for most workers lag behind. A recent poll for the Financial Times showed that internationally, the average income for those in the bottom fifth of the pay scale has fallen 2.5%.

Meanwhile record company profits, such as those of BA, Sainsburys and Shell, pile up. The government's belated and flawed attempt to redress the situation underlines their total inability to desist from their 'help the rich get richer at workers' expense' policies.

As a colleague at my call centre said when the abolition of the 10p rate was implemented: "Our tax has increased so that management's can be cut!" Reeling from the devastating blow of the May local elections, Labour has desperately scrabbled around for policies to regain some measure of popularity, lost due to their attacks on the working class and poor, and now wants to draw a line under the 10p tax robbery.

Despite claiming that there was no money available, the government has suddenly found £2.7 billion to give to tax payers by raising personal tax allowances - the amount you can earn before you start to pay tax on it - for this year's budget.

The Chancellor claims he is responding to the public's outrage. Backbench MPs and union leaders have cheered the move, and the Brownite MP John McFall said not welcoming the move was "nothing but churlish and mean".

But there is nothing mean about checking out some basic facts about this U-turn. 1.1 million households earning £6,035 to £13,355 will still lose out by up to £112 a year, and among them, childless workers under 25 or who work less than 30 hours a week will lose most as they don't get working or family tax credits.

Also, while the increase in income tax is permanent, this change in tax allowances is only for a year. Tax allowances are changed every year yet this government of spin and lies expects us to trust them that in a year's time they won't just revert to tax allowances similar to last year.

It would cost £6 billion to put the 10p income tax band back in place but the government claims this is too much. It would rather continue to make cuts to corporation tax for big business, or spend billions on occupying Iraq and on Trident weapons.