Soldiers to get £2,240 tax-free bonus
Des Browne informed MPs of the changes this afternoon
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Tuesday, 10, Oct 2006 07:45
The government has confirmed that British soldiers serving in hazardous warzones will receive a tax-free bonus.
Defence secretary Des Browne told the House of Commons that the annual fee would benefit more troops compared to complete tax exemption, especially soldiers of lower ranks.
Up to 15,000 military personnel in Iraq, Afghanistan and the Balkans will receive the £2,240 bonus backdated to April 1st.
Mr Browne thanked the Treasury for making the £60 million available to fund the scheme, which he said would not take existing defence funding away from frontline needs.
Explaining that providing support for the armed forces was not just about resources, the defence secretary said he was "constantly reviewing what more is needed and for some weeks I have been looking at pay levels for forces on operations".
"Our forces are some of the best paid in the world, only Canada pays more across the ranks," he said, before stating that "half of our people in operations will be better off compared to a tax exemption".
Mr Browne explained: "This is a complex area, but I can assure the house that the troops who have been fighting in Afghanistan over the summer, will not miss out."
The defence secretary also told MPs that the level of violence and sectarian killings in Baghdad remains "unacceptable", despite the "impressive commitment" from US, coalition and Iraqi forces.
He praised British troops in Afghanistan despite the "difficult, dangerous and exhausting" tasks that faced them and also pointed to the construction of 2,000 schools and 1,700 hospitals as indication of the progress that the country was making.
"In every encounter with the Taliban, our forces have defeated them, this is a clear message that we will not be beaten in combat, a message that is not lost on the local population," he said.
Speaking earlier today, General Patrick Cordingley, commander of the desert rats in the first Gulf War, told BBC Radio 4's Today programme that the decision to give troops a tax-free bonus was long overdue.
"I think everybody will be extremely pleased," he said.
"In the past I've always thought that this tax business when you're abroad on active service doesn't seem to make any sense," General Cordingley explained, adding that in some instances soldiers actually lost money when they were re-allocated to different military postings due to rules governing the payment of overseas allowances in various countries.