Budget views in blue: Child Benefit Reduction & withdrawal
In a couple, the partner earning more than £50k will suffer a new tax from January 2013 – 1% of the benefit for every £100 over 50k. This obviously becomes 100% once earnings are 60k.
Clearly it isn’t compulsory to pay this tax if benefit isn’t claimed.
The welfare system is being overhauled and this is of no surprise to anyone. It is also quite counterintuitive to provide a government benefit to families who do not need it. However, how much the government saves is unknown – the cost of administration aren’t small.