Child benefit cuts ''should be held back''
07 November 2012
The Chancellor George Osborne has been told to delay for three months his planned cut in child benefit for high earners. This would mean bringing in the changes next April rather than January.
The Institute of Chartered Accountants of England and Wales (ICAEW) wrote to Osborne to express concern that the government had not 'sold' the policy to the public properly and had not addressed some of the complicated factors involved in the change.
The coalition has said that all of the child benefit will be taken off families where one person earns more than £60,000 and a portion will be taken away if an individual earns between £50,000 and £60,000 – but the money won't actually be stopped, it will be claimed back from taxpayers through their tax returns.
The ICAEW chief executive Michael Izza wrote: "This single policy is symptomatic of a wider problem. [The] Treasury is setting policies… which are impossible for [Her Majesty's Revenue and Customs] to implement without creating complex, burdensome processes and requirements for taxpayers and businesses."
Labour's shadow Treasury minister Catherine McKinnell said the ICAEW was right to air its concerns with the Chancellor because the child benefit policy had not been thought through properly and was proving to be a costly administrative nightmare.
She said the policy was also unfair because it penalised families with a single high earner and allowed families bringing in a combined £100,000 to keep every penny of their child benefit. "If ministers really wanted those on the highest incomes to pay more they should cancel their tax cut for people on over £150,000 rather than targeting families on £50,000," McKinnell said.
A total shambles, they are spouting an ideology of fairness while being blatently unfair, the policy is clearly ill thought out and now will be slavishly adhered to despite the obvious shortcomings to avoid yet another `u' turn. this lifelong tory voter will NEVER make that mistake again.
S C - Llandudno
Whilst I agree some households may not now need child benefit, mine being one of them, why should children on lower household incomes pay for higher house hold income families to still receive child benefit? To treat people in such an unfair manner is appalling.
Sara Slade - Reading
@Sara Slade. Were this based on HOUSEHOLD income i dont think you would hear a peep out of many, however a family on a household income of £98k is still going to receive this benefit (paid for by someone on a household income of £60k) while the person on £60k will not receive it, still sound fair?
SC - Llandudno
This is an extremely unfair policy. The poor wont benefit. Most people would like to earn £60:000
Give the extra money to those who WORK and don't earn this amount - you may not then get so many people who don't want to work because they are better off on benefits.
It is totally unjust to expect any one with one £60,000 income to forego this benefit if those with a household income of £90,000 can still benefit.