Socialist Worker

Income tax changes help the rich

Issue No. 2207

New parents lost up to £1,235 in the budget as they were hit with attack after attack by the Tory toffs.

He snatched away the health in pregnancy grant, which gave £190 to every woman when she reached her 25th week of pregnancy.

The grant was designed for poorer parents to spend on eating a healthy diet during pregnancy, as evidence shows this is important for a child’s later health.

And Osborne restricted the Sure Start maternity grant to the first child only.

It was a grant of £500 per child for parents on low incomes to buy basics for their baby, such as baby clothes, a pram, a cot and nappies.

Presumably this Tory miser, who had only the best when he grew up at posh private schools, expects poor kids to make do with hand-me-downs.

As if that wasn’t enough, lone parents will now be forced to work as soon as their youngest child reaches the age of five. At the moment they can look after their child until they are ten.

The government says this will hit 15,000 people every year.

Meanwhile tax credits for families earning more than £40,000 are to be cut.

Tax credit is made up of different elements. These include the family element, the baby element, the child element among others.

Osborne removed the baby element of the credit, which is worth up to £545.

The child element is to be increased by £150 a year above inflation.

But in the myriad complexity of tax credits Osborne has snuck through cuts that will lower the amount many low-income families get.

Lack of information and a cumbersome application process mean that only 40 percent of those entitled to tax credits claim them – dropping to just a quarter of single people on low incomes.

Those under 25 without children are not even eligible.

And people who do manage to obtain tax credits often find that they become caught in a trap where any extra money they earn can be wiped out by taxes.

The Treasury’s own figures show that 1.9 million people on tax credits – including about half of all pensioners – whose income is over £6,500 a year are allowed to keep less than 40p of every extra £1 they earn.

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