TUC leader Brendan Barber has slammed a Con-Dem stealth attack that threatens to slash the incomes of Britain’s poorest working families by over £1,000 a year as a “reminder that we are not all in this together.”
The union confederation revealed that hidden technical changes in last month’s emergency Budget will take £1,025 from the pockets of half a million families.
Tory Chancellor George Osborne is snatching £550 million back from tax credit allowances – which means that families where workers become unemployed or ill, work shorter hours or are hit by pay cuts and freezes will suffer.
Previously, such families received tax credits which compensated for the loss of pay.
But, from 2012, the Tory changes will mean that these families will have to lose at least £2,500 in income before the government even begins to help them through reducing their tax bill.
Mr Barber pointed out that, with 50 per cent of working families in receipt of tax credits earning less than £20,000 a year, any loss of up to £2,500 without any credit to make up the income cut could be devastating.
“In his emergency Budget speech, the Chancellor promised not to hide any hard choices from the British people or bury them in the small print of the Budget documents,” Mr Barber recalled.
“While the rich have been let off the hook, those on low incomes are being left to pick up the cost of the recession,” the TUC general secretary declared.
“But this cut in tax credit entitlements is another reminder that we are very definitely not all in this together.”
Mr Osborne is currently making the Con-Dem priorities crystal clear by preparing to rewrite Britain’s tax code in a measure that the TUC fears will be a gift for “big companies and the super-rich.”
Ordering a review of “the spaghetti bowl of reliefs and allowances that make our tax system less competitive than it should be,” Mr Osborne declared that the government would create a new Orwellian-named Office for Tax Simplification.
The Chancellor boasted that the scheme would “provide an opportunity for business to feel that their voice can be heard.”
The Institute of Directors was quick to laud “tax simplification” as “a brilliant idea.”
Tellingly, British Chambers of Commerce director David Frost added that he hoped that wealthy bosses would soon “benefit from lower rates of tax.”
But Mr Barber countered the businessmen’s celebrations with a warning that “it is already too easy for companies to avoid paying taxes and the worry is that the Office for Tax Simplification will be a softening-up exercise for tax cuts for the rich.”