Hardworking middle class families with children are the main beneficiaries of the 2008 budget, which is markedly less generous with single persons and those in the lower income bracket.
A middle class family with two children, where both parents work to earn an annual income of Lm16,000, will gain an extra Lm715 during the next year: an increase of nearly Lm60 a month.
On the other hand, a working class family with one bread winner earning a meagre Lm4,500 a year will only gain an extra Lm267 a year: nearly Lm 22 a month.
The working class family does not get any tax relief but over the next year will receive Lm764 in children allowances – Lm187 more than now.
Meanwhile, the middle class family which currently receives nothing in children allowances will receive a hand out of Lm214.
While giving relief to all social classes, including the worse off, the budget’s tax cuts tend to encourage people to work and earn more.
The family-oriented budget only gives partial relief to single persons who live alone and who have to pay utility bills and other expenses. A single person earning Lm6,500 will only get a budget relief of Lm 147 during the next year.