Cuts in tax credits for low-income families will outweigh an increase in tax exemptions for many of the working poor in Britain, an economic think tank said.
The Institute for Fiscal Studies said about 850,000 families will lose child tax credits when the new fiscal year begins Friday, The Independent reported. The institute estimated the average loss at 511 pounds ($813).
More than 200,000 families face the loss of the entire child credit because those working fewer than 24 hours a week will no longer be eligible for it. The institute said a couple with an income of 15,500 pounds ($24,450) a year would see a net loss of almost 3,000 pounds ($4,776).
''Those working under 24 hours a week face the most brutal cuts," said Gavin Kelly, head of the Resolution Foundation, adding that the cuts will "push some families back on to benefits."
Liberal Democrat leaders touted the increase in the personal exemption as a major move toward fiscal fairness. The tax plan introduced by Chancellor of the Exchequer George Osborne also included a cut in the highest tax rate.