Building a fairer society

The Government is committed to tackling child and pensioner poverty, rewarding saving and building a modern and fair tax system in which everyone pays a fair share. Budget 2002:

introduces a new Child Tax Credit from April 2003 and increases the child allowances in Income Support and Jobseeker's Allowance by £3.50 a week from October 2002;

introduces a new tax incentive to promote research into drugs and vaccines to treat killer diseases in the world's poorest countries;

freezes duties on spirits, wine and beer; increases the duty on alcopops in real terms; and raises tobacco duties in line with inflation;

reforms the taxation of North Sea oil to ensure a regime that raises a fair share of revenue while promoting investment; and

introduces new measures to tackle tax fraud and close loopholes in the tax system to improve fairness and protect government revenues.

The Child Tax Credit will be introduced in April 2003 to provide a single, seamless system of income-related support for families with children.

The Child Tax Credit will bring together the support for children currently provided through the Working Families' and Disabled Person's Tax Credits, the Children's Tax Credit, Income Support and Jobseeker's Allowance. On its introduction, the Child Tax Credit, and universal Child Benefit, will guarantee support of:

£26.50 a week for the first child for the 85 per cent of families with an income of less than £50,000 a year; and

£54.25 a week for the first child in families with an income of less than £13,000 a year.