25-07-03
Parents of twins and triplets still lose out under tax credit system – Barrett
John Barrett, Liberal Democrat MP for Edinburgh West, has called on the Chancellor to abolish a loop hole in the new child tax credit system which leaves families with twins or triplets worse off.
The child tax credit, which was introduced in April this year, incorporated the child elements of the Working Families Tax credit and Children's Tax Credit. It was designed to create a more integrated system of income related support for families with children.
The family element of the child tax credit pays £545 per year to every eligible family. This figure is doubled in the financial year of a child's birth, called the 'baby bonus'. However, this bonus is only payable per birth and not per child. As a result, couples who have twins miss out on £545 and those with triplets miss out on over £1,000.
John Barrett has now backed a cross-party
parliamentary motion, which calls on the Government to take
urgent action to the
end the discriminatory approach. It is estimated that
changing the system would only cost £5 million a year.
John Barrett commented:
"The baby bonus was supposed to recognise the extra costs that come with the first 12 months of a new born baby. However, the Treasury's tax credit rules fail to recognise that these costs are even greater if a couple have twins or triplets.
"After all, every baby in multiple births still needs to be fed, clothed and changed. Whilst the costs of twins may be double that of a single baby, the child tax credit takes no account of this.
"The Chancellor believes that in total, the child tax credit will cost him and the Treasury £13 billion. Changing the system to ensure families with multiple births don't lose out would only increase this figure by 0.04%. Surely this extra money can be found so that couples who face the additional costs of multiple births don't lose out."
ENDS
Notes
to Editors
1. The Child tax credit is for families with at least one child. It is made up of the following elements:
-
A family element of £545 per annum, that is payable to any family responsible for a child. It is paid at a higher rate to families with at least one child under the age of one. This is known as the baby element.
-
A child element for each child you are responsible for. This is paid at a higher rate if the child has a disability and at an enhanced rate for a child with a severe disability. This is known as the disabled child element.
2. The Treasury
estimate that the full cost of the child tax credit is £13
billion. More information on this
is available from the original budget press release at
www.hm-treasury.gov.uk/budget/bud_bud02/press_notices/
bud_bud02_pressrev3.cfm
3. More general information on tax credits is available at www.inlandrevenue.gov.uk
4. More
information on the campaign to reform the baby bonus to
help parents of twins is available from the Twins and
Multiple Births Association at
www.tamba.org.uk/html/news.htm
www.twinsclub.co.uk/general/childtaxcampaign.htm