Monday, October 04, 2010

Child Benefit Cut - It's 3 Years Away But My Word Are Folk Angry

There are 2 words that describe the cut of Child Benefits for households with a higher rate income tax payer from 2013 and it depends which side of the argument you are on.
If you're for it then "simple". If you're against it then "crude".

This is because it hits single earner households when dual earning households could bring in a lot more money between them and still receive Child Benefit. If you trust government IT systems then crude is appropriate. How much harder is it to track the total earnings of a household compared to tracking a higher rate taxpayer and blacklisting their house?

I can't tell which it is. It could be that the Chancellor knows that this system is the most practical to implement so the savings aren't eaten up by IT costs. Alternatively, because the perceived unfairness is so obvious, it could be a great rouse to cut Child Benefits for households bringing in more than the higher rate income tax threshold further down the line.

Of course, because it is 3 years down the line, a ludicrous amount of time, it may not even come to pass.

The thing about this benefit is that anyone affected by its absence is not going to justify a sob story. Its not going to take food off the table or mean the heating can't go on in the winter. It's going to mean less money in the trust fund, a downgrade in the family holiday or having to give up the weekend pony rides. Also, 3 years is a bloody long time to prepare for it so no-one can say they weren't given fair notice.

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