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Wednesday, 28 October 2015

Wednesday, October 28, 2015 Posted by Hari No comments Labels: , , , , , , , , ,
Posted by Hari on Wednesday, October 28, 2015 with No comments | Labels: , , , , , , , , ,

Fee, Chris and KJ have the answer...

SOURCE Channel 4FactCheck: the tax credit crunch explained
The Treasury is proposing cutting the income thresholds for tax credits – that’s the amount of money you can earn before your tax credits begin to be withdrawn. If a new piece of legislation is passed, people will start seeing their Working Tax Credit reduced after they earn £3,850 instead of £6,420. The Child Tax Credit threshold will fall from £16,105 to £12,125. Once households reach the threshold, the credit will be removed at a faster rate – by 48p in the pound instead of 41p. And the amount of extra income you can earn in a year without affecting the payments is being cut from £5,000 to £2,500. There is no transitional protection to soften the blow for people who will see their benefits cut. The proposed changes come on the back of other reforms to benefits and tax credits already voted through in the summer Budget and the Welfare Reform and Work Bill. Ministers have said that the Conservatives were upfront with voters about wanting to slash Britain’s benefits bill. But there was no specific mention of tax credits in the party’s 2015 manifesto. In the party leaders’ edition of Question Time just before the election, an audience member asked David Cameron if he would “put to bed rumours that you plan to cut child tax credit and restrict child benefit to two children”. He replied: “No. I don’t want to do that. This report that was out today is something I rejected at the time as Prime Minister and I reject it again today.” Asked if the child tax credit payment was going to fall, Mr Cameron said: “It’s not going to fall.”

SOURCE EVENING STANDARD: Cameron orders review of Lords after they vote down Tory tax credit cuts
David Cameron today threatened to clip the wings of the House of Lords after suffering a humiliating defeat over tax credits. The Prime Minister ordered a constitutional review to stop the Upper Chamber “wrecking” the Government’s legislative programme. Commons Leader Chris Grayling vented the Government’s anger at peers, accusing them of breaching a century-old convention that the Lords do not block the government’s financial measures. But Labour and Liberal Democrat peers deny that they broke convention as the tax credits reforms were not in a bill but in secondary legislation and had not been detailed in the Conservatives’ election manifesto. Senior Tory David Davis played down claims constitutional traditions had been broken by the tax credit votes. He said: “The simple truth is that this was an incredibly important, possibly harmful, thing to three million people — hard-working families, the people we are supposed to support — and somebody had to tell the Government to think again.”

SOURCE THE SUN: Tax credits cut ‘bonkers’
MORE than three million lower-paid households will lose an average of £1,350 a year under planned tax credit cuts, a new report has found. To add to the insult, letters informing struggling families exactly how hard they will be hit are due to arrive just before Christmas. A new National Living Wage of £7.20 an hour is designed to offset the cuts, but the Resolution Foundation found that for 3.2million families it will be nowhere near enough to fill the shortfall. The think-tank’s analysis found a two-parent family — where one adult works full time and the other does 20 hours a week on the minimum wage — will get a £1,100 annual pay rise, but be £1,800 out of pocket overall as tax credit cuts bite. A single parent working full time on the minimum wage will get a £700 pay rise in 2016 but be £1,500 worse off overall due to the cuts. Resolution Foundation senior economic analyst David Finch said: “The Government needs to re-think its welfare cuts which will hit the wallets of many hard-working people.” A poll yesterday found more than one in four voters would be less likely to vote Tory at the next election because of the cuts. Many Tories also joined calls for the Chancellor to ease the pain. Self-employed telemarketer Judith, 44, works flexible hours to care for daughter Niamh, 12. The single mum, of Wellingborough, Northants, said: “I’m going to have to cut back hugely. “I can’t afford to run a car, I haven’t had one for nine years. This means even more cutbacks. It is like a punch in the teeth. £1,300 is a lot of money to cut from what I have.”

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