Tax Cuts should target families with children, says new poll

• Three in five say families hit hardest by cost of living crisis
• Squeeze on household budgets fuelling family breakdown
• Labour supporters would consider switching to Conservatives if Chancellor unveils a “Budget for Families”
• Young people most in favour of family tax cuts
• Over 80 per cent of parents with dependent children say UK tax system unfair
• 70 per cent say tax household income not individual parents

The cost of living crisis has hit families with dependent children harder than any social group, according to a far-reaching new opinion poll showing widespread public support for tax cuts in the forthcoming March Budget.

Three in five people (60 per cent) take this view as opposed to one in four (24 per cent) who disagree. Numbers in agreement rise to 75 per cent of those aged 18 – 24 and 84 per cent of those with dependent children.

The public also take the view that the squeeze on household budgets is driving up levels of family breakdown, which they regard as a major social problem and associate with school failure, crime and unemployment.

A clear majority (51 per cent as opposed to 31 per cent) said that if families had more money in their pockets, levels of family breakdown would be reduced.

A “Budget for Families” featuring significant tax reductions would also boost Conservative prospects. Nearly one in five adults (18 per cent) say it would make them more likely to vote Conservative, three times more than the 6 per cent who would be less likely.

Labour supporters (by a factor of two and a half to one) and Lib Dems (three to one) are also attracted by a tax-cutting Budget for families.

Appetite for family tax cuts is strongest among the young (18-24-year-olds). By a margin of more than six to one (33 per cent to 5 per cent) young adults say they would be more inclined to back the Tories if the Chancellor eased the financial burden on families.

The vote-winning potential of family tax cuts are even more startling among people with dependent children. Nearly two in five (38 per cent) would be more likely to vote Conservative – as opposed to 3 per cent less likely – and this figures rises to an astonishing 47 per cent among adults with young children.

Overall, the poll of 2,000 adults by Whitestone Insight, commissioned by the Family Hubs Network, reveals widespread public dissatisfaction with the way the UK tax system – almost uniquely in the Western world – fails to take account of the extra costs faced by parents in bringing up children.

Asked about this proposition, nearly two in three people agree (63 per cent), a proportion that rises to 72 per cent among Labour voters and among young people aged 18 – 24 (compared with 57 per cent of those aged 55 and over).

Among adults with children aged 18 and under it rockets to overwhelming proportions – 84 per cent.

The Family Hubs Network, co-founded by former Conservative Party treasurer Lord Michael Farmer and David Cameron’s former family policy adviser Dr Samantha Callan, will submit these poll findings to the Chancellor, urging him to end the injustices in the UK system in taxing the income of families.

Lord Farmer has consistently argued in the Lords for better support for families to prevent them breaking down, including where parents are in prison.

He said: “Family breakdown has so many negative ramifications for the children and adults involved – and for society. Anything that pours petrol on the fire cannot go unaddressed.

“The unfairness of our individualised taxation system, interacting with massive pressures on living costs, is driving many families beyond breaking point.

“We are not arguing for new cash benefits but for families simply to be able to keep more of their hard-earned cash. The Government must reform how families are taxed.”

Other findings from the poll support the case for changes to the UK tax system which, unlike those in many other advanced industrial countries, has for nearly 40 years taxed the partners in a relationship as individuals rather than taxing household income – and so made no allowance for dependent children.

Asked whether they supported changing the tax rules so that child benefit is paid according to family income rather than that of the individual parents (which eliminates it after one partner earns more than £60,000 a year) nearly seven in ten (69 per cent) backed the switch.

The public also support the limited support (worth up to £252 a year) that the tax system gives to married couples. Just over half (51 per cent) agreed with this allowance, compared with 28 per cent who disagreed. Similar proportions (49 per cent agree; 29 per cent disagree) backed the proposition that the Chancellor should double the allowance to nearer £504 in his Budget.

The poll also found popular support for easing the tax burden on the middle classes. The current freeze on the threshold for paying tax at the higher 40 per cent rate means that in five years time, some three million more people will be paying income tax at 40 per cent.

Faced with this prospect, more than one in three people (36 per cent) oppose the freeze on the 40 per cent threshold, compared with 23 per cent who agree with it.

Asked about which kind of tax cuts the Chancellor should treat as a top priority in the Budget, cutting VAT and income tax cuts for pensioners came out equal first (38 per cent), closely followed by income tax cuts for families with dependent children (35 per cent).

There is particularly strong support for family tax cuts among people with dependent children, with 55 per cent making it a top priority.

The figures were markedly higher than those for inheritance tax cuts (24 per cent) or reductions in business taxes (16 per cent). Only one in eight people (12 per cent) said that the Chancellor should not cut taxes in his Budget.