Middle Income Earners Lose Child Tax Credits
"Although the Chancellor mentioned only cuts in tax credits for those earning £40,000, a table at the back of the Budget information book showed that those earning over £30,000 with one child would receive no tax credits from April 2012, while those earning £25,000 would see their entitlement cut.
The move looks like a compromise between the Tory and Liberal Democrat policies. Both parties went into the election pledging reductions in tax credits, but the Lib Dems wanted to go much further, cutting all payments to families with a total income of more than £25,500.
The Budget table shows that a family earning £50,000 or more would currently receive £545 a year in tax credits if they have one child over the age of one. This amount will fall to zero next year, while a family earning between £25,000 and £40,000 will continue to receive the payment. However, in the financial year between April 2012 and 2013, families earning £30,000 and over will receive nothing, and those earning £25,000 will see their entitlement cut to £460 a year...
...Families will also see child benefit frozen for three years. The allowance is currently paid at a rate of £20.30 a week for the eldest child and £13.40 a week"
So let me get this right: the two payments that go directly to the carer of the child will now be frozen/reduced/cut. Well that's gonna do a lot to get rid of child poverty, isn't it?
The thing is, it isn't about how much the family earns, but how much of those earnings get to the children. And Child Tax Credit and Child Benefit get to the children.
Makes me wonder how many home edders will now have to put their kids in school and go back to work full time.