The Conservative Party has promised to raise the personal allowance for pensioners via a 'triple lock plus' if they win July's general election.
In an announcement on Monday night, prime minister Rishi Sunak said as part of the plans the personal allowance for pensioners will increase by either 2.5 per cent, in line with average earnings or inflation - whichever is higher.
Writing in The Telegraph, Laura Trott, chief financial secretary to the Treasury, said: “This government have always protected and will always protect the most vulnerable. That has been our track record since 2010, and that is what we will continue to do."
The BBC reported Labour's shadow business secretary Jonathan Reynolds did rule out a similar move but said he did not think the Conservatives' plan was "credible".
He said the government under Sunak had frozen thresholds for income tax and that their proposal "contradicts what they've done in the last few years".
Paul Johnson, director of the Institute for Fiscal Studies, said the proposal was an example of the Conservatives planning to undo their own tax policies.
He said: "Pensioners used to have a higher tax allowance than working-age people, but since 2010 the tax allowance for pensioners has been cut by more than 10 per cent while that for working age people has risen by 30 per cent.
"Going forward about half of this proposed tax cut is simply not following through with plans for tax rises pencilled in for the next three years."
Mike Ambery, retirement savings director at Standard Life, said the combination of rising wages and high inflation mean that the triple lock has been valuable in recent years
He said: "So much so that it is rapidly closing in on the tax free personal allowance limit which has been frozen at £12,570 since 2021.
"The impact of this has been to drag more and more pensioners into the tax system and the proposal on the table is designed to ensure that a gap is always maintained between the state pension and personal allowance so that this income remains tax free.
"There is some precedent for different allowances for pensioners as they are currently exempt from NI payments on earnings but this would be an additional advantage.
"The question likely to hang over this approach is one of intergenerational fairness as while there are a large group of pensioners struggling to get by, there are also many who are comparatively well off and it appears the policy would apply to both groups."
The triple lock was first introduced in 2011 and means the basic state pension and single tier state pension increase by the highest of earnings, inflation (CPI) or 2.5 per cent.
In line with this, in April pensions rose by 8.5 per cent.
tara.o'connor@ft.com
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