This week's opinion: 21 November 2024

Cliff edges in the tax and benefits system are a perennial problem. I’m sure most readers will have seen figures showing that a person earning just under £100 000 becomes much worse off with a modest salary increase because of the combined effect of the abatement of personal allowance the loss of tax-free childcare and free childcare hours. More serious is the position of those who often inadvertently go over the income limit for carers allowance and are required to repay the whole of the allowance and possibly face prosecution for fraud.

The argument for cliff edges is that they are simple – either you exceed them or you don’t. Tapering is more complex. One taper on its own is probably manageable but where several different tapers interact it can become a complete nightmare. There is a solution. Instead of complicated rules the...