The Scandal of the Tax Credit Cuts

20 Oct , 2015  

Last night (20th October 2015) I voted to oppose the Governemnt’s plans to cut Tax credits. Their proposals will further impoverish over 3 million working families. 150,00 of these are families with disabled children. 7000 families and over 10,000 children in Burnley and Padiham will be affected. They are to be punished it seems because they are poor. Undoubtedly the Tax Credit system needs reform and the way to do that is to introduce a real Living Wage. If people got paid enough to live on at work there would be no need for Tax Credits. The Government plan to introduce a new National Living Wage is supposed to make up for any short fall that families experience when their Tax Credit is cut. The fact is this that at the levels proposed the wage is really a Minimum wage but most importantly the problem is one of timescales. The Tax Credit cuts are to come into force in April 2016 and the National Living Wage not until 2020. What are the people who rely on Tax Credits to survive supposed to do in the meantime? The average family will lose £1300 a year and some as much £3000. People do not choose to work for low pay too often they have no choice. Scandalously before the General Election David Cameron and several members of the Cabinet repeatedly promised not to cut Tax Credits.

It is also important to remember that at the same time the Government is giving tax cuts to the wealthiest. This means that people who earn more that £2 million a year will be £250,00 a year better off so over the life of this parliament these people will have gained £1.25 million in tax cuts whilst a cleaner earning £13,500 will have lost £6,800 in tax credit cuts and a medical secretary earning £22,200 will have lost £9,400. In addition to this corporation tax paid by businesses has been cut and similarly inheritance tax has has been cut. The Government has made a clear choice and has decided to make the poorest pay to give tax cuts to the richest. This is an absolute disgrace!

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