The starting rate of income tax, often known as the 10p rate, was the lowest rate of personal income taxation in the United Kingdom

Taxation in the United Kingdom

Taxation in the United Kingdom may involve payments to a minimum of two different levels of government: The central government and local government. Central government revenues come primarily from income tax, National Insurance contributions, value added tax, corporation tax and fuel duty...

 from 1999 to 2008. It was introduced by then Chancellor of the Exchequer

Chancellor of the Exchequer

The Chancellor of the Exchequer is the title held by the British Cabinet minister who is responsible for all economic and financial matters. Often simply called the Chancellor, the office-holder controls HM Treasury and plays a role akin to the posts of Minister of Finance or Secretary of the...

, Gordon Brown

Gordon Brown

James Gordon Brown is a British Labour Party politician who was the Prime Minister of the United Kingdom and Leader of the Labour Party from 2007 until 2010. He previously served as Chancellor of the Exchequer in the Labour Government from 1997 to 2007...

, in his 1999 budget and abolished by him (in his last budget as Chancellor) in 2007.

Description

The starting rate was introduced in Gordon Brown's third budget as Chancellor. It applied to income between £4,335 and £5,835 and was charged at 10%, replacing a previous 23% basic rate. By 2008 the starting rate had been raised to apply to income between £5,225 and £7,445. The starting rate was the lowest rate of income tax, and as such was the only income tax paid by 1.8 million of the lowest earners. Gordon Brown said of its introduction:

"The 10p rate is very important because it's a signal about the importance we attach about getting people into work and it's of most importance to the low paid. This is not about gimmicks; this is about tax reform that encourages work and families, on the families side it is replacing what was an anomalous married couples' allowance and replace it with a child tax credit."

Abolition

The 2007 budget, Gordon Brown's

Gordon Brown

James Gordon Brown is a British Labour Party politician who was the Prime Minister of the United Kingdom and Leader of the Labour Party from 2007 until 2010. He previously served as Chancellor of the Exchequer in the Labour Government from 1997 to 2007...

 last act as Chancellor

Chancellor of the Exchequer

The Chancellor of the Exchequer is the title held by the British Cabinet minister who is responsible for all economic and financial matters. Often simply called the Chancellor, the office-holder controls HM Treasury and plays a role akin to the posts of Minister of Finance or Secretary of the...

, abolished the starting rate tax rate from April 2008. This meant that all income above the personal allowance (£5,435 in 2008) and below the higher rate band would be taxed at 20%, with the effect that taxpayers earning above the personal allowance would be up to £232 worse off each year.
The abolition of the band came into effect at the start of the 2008 tax year. It was the source of considerable criticism from within the Labour Party. High profile figures protested, including former minister Frank Field

Frank Field (UK politician)

Frank Ernest Field DL is a British Labour Party politician, who has been the Member of Parliament for Birkenhead since 1979. From 1997 to 1998, he served as the Minister of Welfare Reform, before leaving the Government, following differences with Prime Minister Tony Blair...

, the MP Angela Christine Smith

Angela Christine Smith

Angela Christine Smith is a British Labour Party politician who was the Member of Parliament for Sheffield Hillsborough from 2005 to 2010, when she was elected to serve the new constituency of Penistone and Stocksbridge...

 and even the then Environment Secretary David Miliband

David Miliband

David Wright Miliband is a British Labour Party politician who has been the Member of Parliament for South Shields since 2001, and was the Secretary of State for Foreign and Commonwealth Affairs from 2007 to 2010. He is the elder son of the late Marxist theorist Ralph Miliband...

.