Nearly 15,000 families in Tayside and Fife will be left hundreds of pounds out of pocket when they are stripped of tax credits and benefits.
Figures released by the independent Institute of Fiscal Studies show that the repercussions of last month’s Budget, which come into effect at the start of the new financial year today, and previous tax rises, will cost families an average of £511 a year.
Both Labour and the SNP condemned the changes, which the SNP claimed would plunge 100,000 Scottish children into poverty. Treasury chief secretary Danny Alexander insisted the reforms were ”fair.”
Until today people earning up to £40,000 a year could claim Child Tax Credits but this is being cut to £26,000.
This will affect an estimated 73,000 Scottish families, costing them an approximate £545 a year.
Additionally, 11,000 working couples who earn less than £17,000 a year will lose their Working Tax, which is worth up to £3,870 a year, if they cannot increase their working hours.Out of pocketAccording to Scottish Labour, a couple with two children will be financially better off unless they cannot increase their working hours by around 19 a week.
In Fife, a total of 6,660 people will lose out because of the changes, 1,410 in Angus, 2,835 in Dundee and 3,350 in Perth and Kinross.
The IFS figures also show that pensioners will be £316 a year worse off from April 2014 because of the so-called ”granny tax” which was announced in last month’s Budget and will reduce their tax free allowance.
Labour shadow Scottish secretary Margaret Curran said: ”It tells you everything you need to know about David Cameron and George Osborne that while millionaires are getting a tax cut, they are making life harder for parents trying to do the right thing.
”Life is tough for families, and from tomorrow it is going to get a whole lot tougher for 84,000 of them.
”This tax credit bombshell is now just a few days away.
”I am calling on the government to urgently think again, and I am calling on Michael Moore to up his game and do everything he can to stop this outrageous attack on families trying to do the right thing.”