Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment his Department has made of the potential merits of indexing the High Income Child Benefit Charge (HICBC) threshold in line with inflation in the context of the increase in the number of families opting out of receiving child benefit and the resultant reduction in tax revenue from that charge between the financial years 2013-14 and 2019-20.
Answered by Lucy Frazer - Secretary of State for Culture, Media and Sport
HMRC has undertaken customer research to explore child benefit claimants’ understanding of the High Income Child Benefit Charge (HIBIC), to help to support and guide their customers to understand and meet their liability for the charge. HMRC currently plans to publish the findings before Summer recess.
The Government is committed to managing the public finances in a disciplined and responsible way by targeting support where it is most needed. The adjusted net income threshold of £50,000 used in the administration of HICBC only affects a small minority of those with comparatively high incomes. The Government therefore believes that the current threshold for HICBC remains the best option.
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, pursuant to the Answer of 24 March 2022 to Question HL6977, on Child Benefit, when HMRC plans to publish the findings of its customer research to explore child benefit claimants’ understanding of High Income Child Benefit Charge, benefits of claiming and the reasons why some do not make a claim.
Answered by Lucy Frazer - Secretary of State for Culture, Media and Sport
HMRC has undertaken customer research to explore child benefit claimants’ understanding of the High Income Child Benefit Charge (HIBIC), to help to support and guide their customers to understand and meet their liability for the charge. HMRC currently plans to publish the findings before Summer recess.
The Government is committed to managing the public finances in a disciplined and responsible way by targeting support where it is most needed. The adjusted net income threshold of £50,000 used in the administration of HICBC only affects a small minority of those with comparatively high incomes. The Government therefore believes that the current threshold for HICBC remains the best option.
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, pursuant to the Answer of 14 December 2021 to Question 87844 on Child Benefit: Taxation, what estimate he has made of the number and proportion of eligible claimants who have opted out of High Income Child Benefit in each year from 2013 to 2020; and what assessment he has made of the effect of maintaining the adjusted net income threshold for that benefit at £50,000 on tax revenues in (a) 2013 and (b) 2020.
Answered by Simon Clarke
The High Income Child Benefit Charge (HICBC) was introduced in January 2013 to target support at those who need it most. It applies to anyone with an income over £50,000 who claims Child Benefit or whose partner claims it. The charge is tapered for taxpayers with incomes between £50,000 and £60,000. Where income is over £60,000, the amount of the charge is equal to the Child Benefit payments.
The table below shows the number and proportion of eligible claimants who have opted out of Child Benefit in each year from 2013 to 2020. These are the latest figures available.
| Total number of families claiming Child Benefit payment + Total number of families that have opted out of receiving Child Benefit payment (United Kingdom) | Total number of families that have opted out of receiving Child Benefit payment (United Kingdom) | Total number of families that have opted out of receiving Child Benefit payment as a proportion of the total number of families claiming Child Benefit payment + total number of families that have opted out of receiving Child Benefit payment (United Kingdom) |
August 2013 | 7,947,000 | 397,000 | 5% |
August 2014 | 7,937,000 | 476,000 | 6% |
August 2015 | 7,908,000 | 492,000 | 6% |
August 2016 | 7,900,000 | 504,000 | 6% |
August 2017 | 7,893,000 | 516,000 | 7% |
August 2018 | 7,871,000 | 545,000 | 7% |
August 2019 | 7,863,000 | 582,000 | 7% |
August 2020 | 7,834,000 | 624,000 | 8% |
The Government is committed to managing the public finances in a disciplined and responsible way by targeting support where it is most needed. The Government considers the adjusted net income threshold of £50,000 used in the administration of the HICBC to be set at the right level. Only a small minority of taxpayers, with comparatively high incomes are affected. As with all elements of tax policy, the Government keeps this under review as part of the annual Budget process. The tax revenue from the HICBC in the 2013/14 tax year was £431m and in 2019/20, it was £416m.
Details on the numbers of Child Benefit opt-outs and tax raised are published annually on GOV.UK at:
https://www.gov.uk/government/publications/high-income-child-benefit-charge-data/high-income-child-benefit-charge (opens in a new tab).
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how many taxpayers had opted out of receiving the Child Benefit payment as of August 2021.
Answered by Simon Clarke
The number of taxpayers that have opted out of receiving Child Benefit at August 2021 is not currently available.
As of August 2020, 623,900 families in the United Kingdom had opted out of receiving Child Benefit. This number is published in official statistics release, ‘Child Benefit Statistics: Annual Release, August 2020’ within Table 9 of the Main Tables found here:
Child Benefit Statistics: Annual Release, August 2020 - GOV.UK (www.gov.uk)
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how many taxpayers are liable to pay the High Income Child Benefit Charge in the 2021-22 tax year.
Answered by Lucy Frazer - Secretary of State for Culture, Media and Sport
The High Income Child Benefit Charge (HICBC) was introduced in January 2013 to target support at those who need it most. It applies to anyone with an income over £50,000 who claims Child Benefit or whose partner claims it. The charge is tapered for taxpayers with incomes between £50,000 and £60,000. Where income is over £60,000, the amount of the charge is equal to the Child Benefit payments.
HICBC is based on the amount of Child Benefit paid and the higher earner’s Adjusted Net Income. A Self Assessment tax return is the only means of establishing this.
As the 2021-22 Self Assessment deadline has not yet passed, HMRC cannot provide the number of taxpayers who are liable to pay HICBC in the 2021-22 tax year. The numbers of individuals with a High Income Child Benefit Charge liability in each tax year are published here: https://www.gov.uk/government/publications/high-income-child-benefit-charge-data/high-income-child-benefit-charge
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what representations his Department has received on the effect of state pension age changes on women born in the 1950s; and what assessment his Department has made of the potential merits of compensating those women for changes to state pension age legislation.
Answered by Simon Clarke
HMT Ministers receive representations on a wide range of matters, including on State Pension age changes.
The Government decided 25 years ago that it was going to make the State Pension age the same for men and women as a long-overdue move towards gender equality. Raising State Pension age in line with life expectancy changes has been the policy of successive administrations over many years.
State Pension age reform has focused on maintaining the right balance between the sustainability of the State Pension, and fairness between generations in the face of demographic change. Changes to State Pension age were made over a series of Acts by successive governments from 1995 onwards, following public consultations and extensive debates in both Houses of Parliament.
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether his Department has made an assessment of the potential impact of abolishing the VAT on school-specific uniform items on families, particularly those on lower incomes.
Answered by Helen Whately - Minister of State (Department of Health and Social Care)
Under the current VAT rules, all children’s clothing and footwear designed for young children who are less than 14 years of age, including school uniforms, attract a zero-rate of VAT, meaning that no VAT is charged on the sale of these items.
The Department for Education plans to publish statutory guidance in Autumn 2021, which will aim to ensure that parents do not incur additional costs from sudden uniform changes.
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what his Department's policy is on abolishing VAT applied to school-specific uniform items.
Answered by Helen Whately - Minister of State (Department of Health and Social Care)
Under the current VAT rules, all children’s clothing and footwear designed for young children who are less than 14 years of age, including school uniforms, attract a zero-rate of VAT, meaning that no VAT is charged on the sale of these items.
The Department for Education plans to publish statutory guidance in Autumn 2021, which will aim to ensure that parents do not incur additional costs from sudden uniform changes.
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment he has made of the potential economic merits for families of abolishing the VAT on school-specific uniform items; and if he will make a statement.
Answered by Helen Whately - Minister of State (Department of Health and Social Care)
Under the current VAT rules, all children’s clothing and footwear designed for young children who are less than 14 years of age, including school uniforms, attract a zero-rate of VAT, meaning that no VAT is charged on the sale of these items.
The Department for Education plans to publish statutory guidance in Autumn 2021, which will aim to ensure that parents do not incur additional costs from sudden uniform changes.
Asked by: Martyn Day (Scottish National Party - Linlithgow and East Falkirk)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment he has made of the potential effectiveness of the consumer duty proposed by the Financial Conduct Authority in their 14 May 2021 consultation on meeting the objective of consumers being owed a duty of care by authorised persons as required by section 29 of the Financial Services Act 2021.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The Government is committed to ensuring financial services consumers are appropriately protected.
In accordance with the requirements set out in the Financial Services Act 2021, the Financial Conduct Authority (FCA) published a consultation on 14 May 2021 proposing a new ‘Consumer Duty’. The Consumer Duty seeks to clarify and raise expectations for the standard of care that should be provided by financial services firms to consumers. This aims to ensure consumers benefit from a higher level of care from financial services firms.
As set out in paragraph 2.31 of the FCA’s consultation paper, the consultation’s proposals have been specifically designed to meet the requirements of the Financial Services Act 2021. The FCA, as an operationally independent regulator, is responsible for carrying out the consultation and for making any new rules which it considers appropriate following the consultation. It would therefore be inappropriate for the Government to comment further on the specifics of the consultation’s proposals.