'Granny tax': Government promised last year to keep raising pensioners' allowances The 5m pensioners thought to be affected by the freezing of the allowance will pay an estimated £3.3bn extra in tax over the next four years. Under existing arrangements, pensioners with an income of more than £25,400 will have their allowance gradually reduced until it is back to the basic personal allowance of £8,105 from Friday. The promise in last year's Red Book was uncovered by the National Pensioners Convention (NPC), which has launched an online petition calling on the Government to keep the age-related allowance and restore the link to inflation. The petition, which will be considered for a parliamentary debate if it attracts 100,000 signatures, has been signed by more than 50,000 so far. Dot Gibson, the NPC's general secretary, said: "Clearly George Osborne is guilty of double-dealing when it comes to the age-related tax allowances. He said one thing last year - and 12 months later he has completely ripped the whole thing up. No wonder pensioners are saying they can't trust the Government. The Chancellor seems to have underestimated the impact of this proposal. I hope he will read the Red Book from last year's Budget and decide he's made a mistake. If not, we'll show him the error of his ways. But one former MP said there was no need for a petition in order to secure a Commons debate on the granny tax. In a letter to The Daily Telegraph, Lord Rooker, the former Labour MP Jeff Rooker, said: "When the late Audrey Wise, the then Tory backbencher Nigel Lawson and I carried our indexation amendments to the 1977 Finance Act we included the income tax age allowance. The simple effect is that the Chancellor must index the allowance each year, and if he does not want to do this he has to bring a parliamentary order to the Commons for approval or otherwise. The last time I checked, the requirement remained in law. So there is no hiding place for Members of the House of Commons. Ros Altmann, the director general of Saga, the over-50s group, and a pensions campaigner for many years, said: "It's astonishing to see a categorical promise broken like this without any acknowledgement and without any measures to offset the effects. This was a direct commitment made by this government, but it's been completely overridden without so much as a by your leave. It's just not acceptable. Ms Altmann added that the pensioners most affected were those on middle incomes who had saved to top up the state pension. "These people - those who had done the right thing - have been desperately let down," she said. Pensioners whose only income is the state pension are unaffected by the freezing of their allowances because their income is below the tax threshold anyway, while those on high incomes already had the age-related allowance clawed back. A spokesman for the Treasury said: "It is sensible to have a single tax-free personal allowance for everyone, especially when we have just announced the largest ever cash increase. Nobody will pay more tax in cash than they do today. The poorest half of pensioners are unaffected by this change and will still pay no tax in 2013/14. In addition all pensioners will benefit from the basic state pension rising by over £5 a week, the biggest ever cash increase.