So what would you have done with Child Benefit?

[LilyBolero]

We all know the reform they have come up with is divisive, unjust and GROSSLY unthought out. Dave and Gideon say there 'is no other way'. So how would you do it?

I would remove it from households with TWO HRT payers (thereby removing the anomaly of a family on 45k losing it whilst a family on 88k keep it).

Also remove it from households with ONE 50% taxpayer

Restrict it to the 1st 3 children to discourage having children as a source of income

You could administer it EXACTLY the same as it is proposed to be now, with a box to check on the tax return, and it would be much fairer.

Or alternatively add a penny on the 40% rate of tax so everyone contributes.

I'd add a penny to the higher tax rate too. That way the burden is spread over all the higher earners, and not just those with family.

And it would be a bloody sight cheaper to administer than the stupid system that they have now (a billion to transfer an allowance!) and much fairer. If I was a single parent just over the 40% limit I would have smoke coming out of my ears right now!

I'm with those who'd scrap it entirely and throw the money in the tax credit pot.

Imagine the outcry if the coalition tried to do this though. It's bad enough with them saying they're taking it off those in the top 15% of pay.

I think that would be more palatable than what they are doing tbh - because the point is they are NOT taking it from the top 15% of pay. Or at least, not the 15% richest households. It's an arbitrary measure, which takes it from people with a particular set of circumstances. NOT the richest.

And there are further anomalys beyond the 'single income/dual income'.

Take 2 single mothers. One is a widow, the other divorced from a very rich man (let's call him Dave). They both bring up their children on their own. The widow has no income except for her salary, which is 45k. Once she's paid her tax, her mortgage and her childcare, there is very little left over.

The divorced lady has no mortgage. Dave is very generous, and gives her a settlement payment of thousands of pounds a month. In fact, let's say he gives her 10 thousand pounds a month, giving a 'salary' of 120k. BUT this is not taxed, so she has 120k in the bank each year. Dave also pays for a nanny for the children. She doesn't work.

Which of these two women should keep their child benefit? Which one 'needs' it? But which one do you think WILL keep it? Remember it's 'tough but fair' - yes that's right, the widow LOSES the money and the very wealthy divorced lady KEEPS it.

(I'm not making any statement on the value/wealth of either widows or divorcees - it's simply for the purpose of the illustration, I know many divorced people are hard up too).

If it has to go - phase it out e.g. Any child born 12m no longer receives CB. Anyone receiving it before that date continues to receive it but the amount is frozen.
I think that's what happened with married couples allowance. Anyone born before a certain date receives it, anyone born after that date doesn't.

'born 12m from now'