Welfare Reform: Tax Credits
Welfare Reform: Tax Credits. In 2003 the UK government will introduce two major new welfare reforms: an Integrated Child Credit for families with children - which will act as a type of minimum income guarantee for children; and an employment tax credit - an in-work benefit designed to tackle in-work poverty. This paper assesses the proposals and concludes that: work incentives will generally increase, though second earners in some couples may be less well off in work; around 3.3 million families will receive a boost to their income; but that the impact on poverty will be small as poverty amongst families without children is concentrated amongst those not working full time and amongst the young, groups which will not be eligible for the new credit. "Credit Where It's Due?: An Assessment of the New Tax Credits", by Mike Brewer, Tom Clark and Michal Myck is published by the Institute for Fiscal Studies.
By Institute for Fiscal Studies, UK.