The Chancellor had been coming under increasing pressure over the issue
Rachel Reeves has confirmed tax details.
Rachel Reeves has set out rules around low-income pensioners and tax payments.
Retirees whose sole incomes are the pension were set to be taxed from 2027.
This is because of frozen tax bands, as the rising pension creeps ever closer to the personal allowance, the point at which someone must pay income tax.
READ MORE: Rachel Reeves confirms bumper above-inflation Universal Credit rise
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This possibility was piling added pressure on Chancellor Rachel Reeves, as it would have hit the poorest pensioners.
But she has now confirmed those who only get the state pension and no other income will not have to pay tax.
In an interview with the money campaigner Martin Lewis, Ms Reeves announced that “in this Parliament, they won’t have to pay the tax”.
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The full state pension, claimed by those who retired after April 2016, is set to pass the personal allowance threshold of £12,570 in 2027.
That meant the issue was only going to grow louder for the Chancellor without any announcement.
However, it does mean retirees with only small private pensions will have to pay income tax.
Extending the freeze on tax bands is known as fiscal drag, as more households are forced into paying higher rates of tax as their incomes rise.
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