Pita Sharples said yesterday in his Budget Policy Statement;
We want to see allocation made to address the income issues of the working poor; and to assist our most vulnerable citizens, benefit dependent families who are not accessing Working for Families. We would be interested in receiving a cost analysis of what benefits could be expected from removing tax on employment, DPB, sickness and invalids benefits.
Does anybody else see the incongruity of one moment slamming welfare dependency and the next suggesting rates could be higher?
Help me out on this if you can. I've been told tax on social security benefits was introduced in the eighties and was intended to ensure one standard of citizenship. Everybody was to pay tax. Is this correct?
(Calling the unemployment benefit the "employment" benefit was surely a slip of the tongue. Or maybe that's the dole you get when working under the table.)
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If I recall correctly, it was also to make it easier from a tax return perspective. People earning for part of a year and on benefits for half of a year would get a 'fairer' tax treatment when they started working (ie. they wouldn't find themselves getting a massive tax bill at the end of the year when their PAYE was compared against their income (work plus benefit).
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