British Child Health Care

Today the British government announced it is dropping its plans to cut the tax relief to child health care.

Gordon Brown was going to dissolve tax relief on childcare vouchers from 2011 because he believed it supported the families who needed it less. Instead, he wanted the money to fund the expansion of free nursery places for toddlers.

The government has now announced that top rate taxpayers would have their benefits halved rather than removed entirely, but basic rate taxpayers would see no change.

However the government said the concession meant it would take longer for its pledge to expand free nursery places to 250,000 two year-olds by 2015.

After the concession, however, the vouchers were not trashed, but the tax relief on all of them will be applied at a rate of 20%. Currently, the taxpayers at the highest tax bracket receive relief at 40%, with the result that the richest 6% of eligible parents enjoy 33% of the benefits.

Statistics given by The Guardian.