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08/03/2012 16:45:00

£4.1bn takeaway set to hurt families

The Institute for Fiscal Studies (IFS) says that tax and benefit reforms currently planned for the coming year amount to a net 'takeaway' of about £4.1 billion, rising to around £9.8 billion the following year.

This will impact hardest on those in the bottom half of income distribution and families due to the effect of welfare reductions and a series of other cuts to tax credits and Child Benefit, the IFS claims.

Robert Joyce, a research economist at the IFS and the author of the report, said that household incomes will be a key consideration for the chancellor George Osborne when he announces the Budget on March 21st.

"New tax and benefit measures … as part of the government's deficit reduction efforts will … reduce household incomes on average," he said. 

"[Households with children] will lose the most from this set of reforms."

Family Action recently reported that some families are spending less than £2 per person per day on food.