First Parental Tax Credit Babies Due Today
From today, low-middle income working families with a new baby will receive up to $1,200 of extra family assistance, said Treasurer Bill English.
"This new Parental Tax Credit was announced at the time of the Budget but only applies for babies born from today. The payment is available in four fortnightly instalments or as a lump sum at the end of the tax year (31 March).
"The Parental Tax Credit aims to help families struggling with the extra costs and possibly reduced income following the birth of a new baby.
"The new measure is part of the Government's tax reduction programme which has seen the take-home pay of low-middle income families boosted significantly. About 50,000 working families already pay no tax at all.
"For example, a family with one income of $30,000 and four children under 13, will get $161 a week in Family Assistance for the 2000/1 tax year - but only pay $106 in tax. That means the tax system pays them $55 a week.
"If one of those children is a new baby, the family will also qualify for the full Parental Tax Credit of $1,200 in total over the 8 weeks following the birth.
"Like all the Government's family assistance measures, the Parental Tax Credit is income-tested.
"A family with four children under 13, including a baby born after 1 October 1999, will qualify for some Parental Tax Credit unless their income exceeds $61,980. A family having their first child from today will qualify for some Parental Tax Credit up to an income of $37,540.
"About 20,000 families are estimated to be eligible for the new payment each year. An Inland Revenue media campaign is underway to ensure that as many as possible will receive the extra help," said Mr English.