Tuesday, October 10, 2006

Gordy's Tax Credits not Working

It looks like Labour's means testing is not having the desired effect and what we all suspected has now been confirmed. This is from the report, funded by the Joseph Rowntree Foundation,

'Labour’s reforms to date have acted to weaken both incentives to be in work at all and incentives for those in work to increase their earnings. On average, tax and benefit changes since 1997 mean that someone choosing to work harder gets to keep 2½p less of each extra £1 they earn.'

This is a real indictment of the Tax Credits scheme, much vaunted by Gordon Brown.

If they really wished to help families, rather than gerrymander the tax system, they should make sure a spouse's tax allowence can be passed onto the other spouse. This will give families much more choice over how they conduct their affairs, rather than the state. It may well even leave a spouse the ability to stay home to look after their children. More and more people realise that kids require a full time parent until teenage. Tax credits just force people into work.

When will this Government realise that the most important job in this country is to be an active and present parent. Not a remote unit of production.

The benefit to the economy wll be incredible, as feral children become a thing of the past.

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