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New year present as child benefit increases early
FAMILIES Increases in child benefit will be brought forward by three months to give families an extra boost in the new year.
The increase, already due to kick in from next April, will now start in January – giving parents an extra 22 for each child.
Alistair Darling said the Government would also bring forward its commitment to increase the child element of the child tax credit by 25 next April, a year before it was due.
He also said Ministers would make permanent the tax relief brought in earlier this year to quell the rebellion of MPs unhappy with the scrapping of the 10p rate of income tax.
In a mini-Budget in May the Chancellor brought in a 600 allowance paid to basic rate taxpayers caught out by removal of the 10p tax rate, due to last until a permanent solution was found in this Pre Budget Report.
Yesterday that was increased by 130 to 730 and made permanent, with Mr Darling stating that would see basic rate taxpayers pay 145 less tax a year in 2009-10.
He said that taxpayers with incomes below 40,000 "should" now pay less tax and national insurance contributions by April 2011 compared with April 2008, although the Tories last night claimed anyone earning over 20,000 would be hit.
Also yesterday the Chancellor said the Government would contribute 50p to every pound saved in the Saving Gateway, a new national savings scheme for people of working age who receive state benefits or in-work tax credits.
Mr Darling said: "We want to encourage those with modest incomes to put money aside. To help them we are setting up a Saving Gateway – which will mean that the Government adds money to every pound saved.
"From 2010, up to eight million people on low incomes who put money into the Saving Gateway will get 50 pence added for each pound they save. The Saving Gateway will be widely available through a range of banks, building societies and credit unions and the Post Office."
He said the Government intended to "step up help for families with children".
"We have already announced that the child element of the child tax credit will increase by 50 above indexation next April. We have also announced a further increase in that credit of 25 above indexation in 2010.
"I now intend to pay both these increases together in April, making it worth in total 2,235 for modest income families. The Government is also working with local authorities to further improve take-up of tax credits and benefits. And I have already announced that child benefit, which was only 11.05 in 1997, will increase from 18.80 to 20 a week in April next year."
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Weather for Yorkshire
Saturday 26 May 2012
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Temperature: 9 C to 23 C
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Temperature: 9 C to 23 C
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