Foreign Perspectives

Standing apart from the system these days we’ve not noticed first hand all of the chaos that has resulted in some of the reorganisations of UK government departments over the last year or two but can only laugh at some of it from afar.

Perhaps the best example is the Child “Tax Credit” and Child Benefit combination.

For political reasons, the Child Tax Credit is called a tax credit although, in all but name, it’s clearly a benefit payment. You claim it exactly like a benefit and it’s paid exactly like a benefit so it’s only the name that differentiates it. And that’s the problem: seeing as it’s been called a “tax credit” then it can’t be integrated with the Child Benefit systems thus saving a fortune on duplication of administrations and reducing the errors being made in payments.

That’s a recent one of course but the National Insurance Contributions have long been separate from Income Tax. The bands at which both are levied have been aligned for quite a while now so there’s no reason to keep them separate other than the political double-speak that called the National Insurance scheme an insurance scheme when in fact it’s merely another tax. If it were an insurance scheme then it would build up some money in the kitty but, of course, it doesn’t as the money is paid out as it comes in.

So when will common sense prevail and such nonsenses be put to an end? Somehow I can’t see it being anytime soon as there are just too many interested parties who it suits to have the current system perpetuated.