Massive Government welfare cuts will be met by removing tax credits from around 3.7million working families under plans being considered by ministers.
El Gordo definitely expanded the welfare state. So, not absurd to consider the Tories reigning it back in again.
Under the plans a two-child family where at least one parent works full-time would see its tax credit entitlement running out at £28,847 of earnings rather than the current £32,969.
Where you set that limit, and the rate of taper, determine the marginal tax and benefit rates faced by people. And those rates then determine their reaction to those incentives.
Don’t know enough about the rates and so on to really know, but that someone on 10% above median household income, 20% or more above median individual income, no longer gets tax credits doesn’t sound quite like the massacre of the firstborn to me.
and that someone on 150% of median incomes is getting a tax credit currently sounds remarkably generous in fact.