Working parents in the East Midlands are being hit with a ‘toddler tax’ of up to £1,700 over two years, Labour claimed this week.
The party says that next year working parents with one child who are expecting a new baby will have their household budgets squeezed on average by £688, with a further squeeze of £1,041 the year after when their second child is born – amounting to £1,729 over two years.
The ‘toddler tax’ is the name that has been given by Labour to the sum of additional expenses which will be incurred by new working parents starting from April this year, as a result of changes to tax and benefit entitlements introduced by the Government.
Labour claimes new mums will lose out from changes to tax credits, Statutory Maternity Pay, the Health in Pregnancy Grant and Child Benefit.
Stephen Twigg, Labour’s shadow education secretary and chair of Labour’s Childcare Commission, said: “Instead of punishing mums who go out to work, we need to ensure that we provide affordable and quality childcare.”
“That would be good for parents and also good for the economy – a quarter of unemployed parents say the cost of childcare is putting them off going back to work.”