Budget: Row over 'granny tax' move

The government has come under fire for plans announced in the Budget to change tax allowances for pensioners, as stakeholders begin digesting the Chancellor's measures.

George Osborne is to freeze tax allowances for anyone over the age of 65 earning at least £10,500 a year, and scrap the relief entirely for those retiring from next April. The Chancellor said the move would simplify a "complicated" system and, by freezing the allowance at 2012/13 levels, would not leave pensioners worse off in cash terms. It is expected to save £1bn a year by 2015. He also said the measure is being introduced alongside an increase of £1,100 in the personal allowance. But Labour said it was a hidden tax rise which would affect millions, as the allowances would not b...