CHILD BENEFIT LATEST!: Fair’s fair in Coalition tax fuck-ups!

Child Benefit Cut ‘Unenforceable,’ Treasury in a Flap

It seems there is a bit of a ‘flap’ on…..  tax law is difficult…. and so, it would appear, is government!  The devil is in the detail…. but have no fear… Beaker will ride to the rescue and make a “Renouncement” ?

The Wall Street Journal reports… “The government is struggling to find a way of making George Osborne’s plans to remove child benefit from those paying 40% tax work.

A Treasury source says the policy is “unenforceable” and likely to be ditched before its scheduled introduction in 2013. Another source at the heart of government says the expectation is that it will eventually not happen. Elsewhere I hear that it is “panic stations in the Treasury.”

At root is a problem that should have been apparent to those designing the policy, if detailed advice had been sought from civil servants before it was announced at Conservative party conference.

Child benefit is generally paid to the mother. She is under no legal obligation to tell the father that she receives it. The Treasury confirms this. It is her benefit. The father’s tax status is irrelevant. If a mother claims it there is nothing forcing her to flag up to the taxman that her husband earns above the level that Osborne stipulates should mean no child benefit.

Indeed, the child benefit was designed with the express purpose of keeping the cash away from men.

7 thoughts on “CHILD BENEFIT LATEST!: Fair’s fair in Coalition tax fuck-ups!

  1. I’m afraid that there is avery easy solution to this. It the father says he doesn’t know or the mother of the child does collect the benefit then the father’s tax code could simply be reduce to recover the amount of the child benefit. A bit rough of course, but the mechanism is already there. I’m not suggesting it would be popular, but it’s not difficult in a technical sense.

  2. If the legislation is changed to exclude HR taxpayers or their partners from claiming CB, then being a HR taxpayer or their partner becomes a material fact in considering entitlement to CB and presumably a question to this effect will be added to the claims process.

    If the claimant refuses to answer then the claim can be refused, if s/he lies then there will be a recoverable overpayment and possibly prosecution.

    Such matters are all meat and drink to tax credits and other welfare benefits claims and there is a considerable infrastructure in place to investigate and adjudicate whether couples are ‘living together’ or not.

    So I very much doubt that this slight wobble by a treasury official who doesn’t really seem to know his stuff will derail the policy at all I’m afraid.

  3. Having heard a lot more about this (and the Today programme this morning), then a lot of what I hear is some of the more comfortably off not realising that the State does sometimes apply some rough-and-ready rules which can have unfair consequences. For instance, I believe the IR make assumptions over tips received in certain occupations. I suspect that a lot of higher rate tax earners are probably not so used to having these applied to them, whilst many of the worse off will.

    That’s not to say I’m in favour of this blanket removal of child benefit for the higher rate tax payers as I think there are better ways, but it’s interesting to see what happens when these type of measures start hitting those in society with more ready access to the media. One might even think that this would include quite a lot of national journalists.

  4. If you can’t get simple policies like this correct, then you have no business being in government. Sadly, we have a bunch of clowns, who are convinced of their own ability.

  5. Breakfast dogs. If the system was fair then the higher rate tax payers maybe inclined to show honesty in declaring their earnings under the priciple that we are all in this together. However this sham of a fag packet policy will get what it deserves one way or another. p.s. saw the P.M. in the local hardware shop looking for a bigger spade.

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