Five million of Britain’s poorest children will lose an average of £750 each a year because of the Government’s cuts to tax credits, The Independent has learnt.
The figures, which show the impact on 2.7 million working families from changes to tax credits in April, were uncovered by Labour in the House of Commons Library.
From next year, tax credits will be withdrawn sooner and at a faster rate as workers’ incomes rise, following an announcement in the July budget. The set rates for benefits and tax credits will also be frozen for the next four years.
Read more: Living wage dodgers will face fines under new rules
10 of the worst measures introduced by the Government so far
Scotland to spend £100m to 'mitigate harm' of Tory cuts
Previously unreported figures from the Institute For Fiscal Studies also show that a lone parent in work will be, on average, £2,021 a year worse off following the reforms.
A couple with children where one parent is working will have, on average, £1,329 less. In both of these cases a large part of the slashed household budget is down to the drastic cuts to tax credit.
Stephen Timms, the acting shadow Work and Pensions Secretary, said: “Tory tax credit cuts will take money away from millions of families and children. It’s time for the Government to make work pay rather than making working families pay.”
A Treasury spokeswoman said: "Our higher wage, lower tax and lower welfare policy, which includes increasing the personal tax allowance to £11,000 from next April, means that work will always pay more than a life on benefits, and the majority of working households will be better off once the changes have come into force in 2017.
“We are also helping children and families by introducing thirty hours of free childcare for all working parents, worth thousands of pounds a year, to support them into work.”
