From: "Andy Pandy" 
Newsgroups: uk.finance
Subject: Re: OT:Govt Benefits - info needed.
Date: Tue, 27 Jan 2004 18:11:06 -0000


"Tim"  wrote in message
news:bv5cu1$hq0$1@hercules.btinternet.com...
> > The system in this country of independent assessment for taxation but
> joint
> > assessment for benefits is completely shite. My wife and I would be much
> better
> > off if we were treated as single people by the tax and benefits system,
> and not
> > as a married couple with kids.
>
> "The system in this country of taxing higher income at a higher marginal
> rate is completely shite.

That's not true when you account for benefit/tax credit withdrawal rates. In
fact the opposite is true, particularly for families.

People on very low incomes have a marginal rate of 100% (IS), reducing to 95.5%
as they get above the applicable amount (HB & CTB), then 89.5% (HB only), then
70% (tax credit reduction, tax & NI), then 33% (tax and NI), then 23% (above the
NI LEL), until finally there is an upward step (41%) - higher rate tax & NI.

> Well, any system is going to be "shite" for the people who would be better
> off with another system.  Unfortunately, there is no system available which
> will make *everyone* better off!   :-(

Duh, really?

I was trying to point out the hypocrisy of a system which treats everyone as an
individual when it comes to income tax, but then treats people as a couple when
it comes to tax credits and benefits. Also that a government which pretends to
be "family friendly" with all its various complicated tax credits etc, still has
a system whereby a couple with kids could be far better off if the system
treated them as single childless people.

I've not so much got a problem with the system, but with the widespread
perception that this government is really generous to all families, which is
simply not true.

--
Andy