Saturday, 12 July 2008

Take low earners out of the tax system.

From Hansard this Thursday:

Low Income Households

Sir Peter Viggers: To ask the Chancellor of the Exchequer what estimate he has made of the amount of tax paid by low income households in the last 12 months.

Jane Kennedy: A single earner family with two children on half male average earnings pays no net tax in 2008-09, as tax credits and child benefit more than offset income tax and national insurance liabilities.

I have to ask: If the millions of people that Jane's answer refers to actually get as much, or more money back from the Government than they are paying in tax in the first place, then why are they paying tax? Surely we are wasting God knows how much money taking tax from these low earners, only to give it back to them in credits. Are they supposed to feel grateful to the government for handouts of their own money? Take them out of the tax system and save us all some money.


Mulligan said...

Whilst many of us can see the complete nonsense of Brown's tax credit system it, intentionally, provides Cameron with a potential minefield.

Any indication he will scrap tax credits (even with , say, doubling of starting tax threshold) would be jumped on with glee by Labour, their BBC poodles and other media as "same old nasty Toreez taking away benefits blah, blah, blah".

Additionally I would expect that quite a few less people would need to be employed to manage a simpler tax and benefits system, so with the disappearance of such "non-jobs" unemployment figures would no doubt rise.

On the upside we would probably be losing a few billion quid less a year, that seems to go astray in current tax credit system...

J J said...

You're being sensible.

This government doesn't do sensible!!

Anonymous said...

travis bickle that was an excellent comment on an interesting point, it's all about everybody either working for or dependent on the client state, thats socialism. It's now referred to by David Cameron as "Big Government".
And that's what it is, a government of interfering, overbearing but woefully undertalented big heads who need putting back in their insignificant little place!!