Rachel Reeves is under increasing pressure to implement higher taxes on major gambling companies in order to fund the elimination of the two-child limit policy.
Over 100 Labour MPs have voiced support for former Prime Minister Gordon Brown’s proposal to impose tax increases specifically on lucrative sectors of the gambling industry, such as online casinos and slot machines.
In a letter to the Chancellor, the group emphasized the urgent need for a targeted levy on harmful online gambling products to address child poverty effectively.
The suggestions, formulated by the IPPR think tank and initially disclosed by the Mirror last month, have the potential to generate up to £3.2 billion, which could offset the expenses associated with abolishing the two-child limit and the benefit cap.
Alex Ballinger, one of the letter’s signatories and a member of the All-Party Parliamentary Groups on gambling reform, emphasized the contradiction of children living in poverty while gambling firms enjoy significant profits, pointing out that gambling remains VAT exempt.
Amid mounting pressure on the Government to revoke the Tory policy, the issue is expected to be a contentious topic at the upcoming Labour annual conference.
Introduced in 2017, the two-child limit restricts claims for Child Tax Credit and Universal Credit to the first two children in each family.
Last year, the Prime Minister established a child poverty taskforce to explore strategies for reducing the number of children experiencing hardship.
While a Government source indicated ongoing efforts and no definitive decision regarding the two-child limit, reports suggested the taskforce might recommend its removal.
Education Secretary Bridget Phillipson, a member of the taskforce, recently criticized the policy as “spiteful,” hinting at a potential repeal.
Senior MP Dame Meg Hillier emphasized the imperative of Labour addressing child poverty, advocating for lifting children out of poverty as a top priority.
She stressed the moral obligation to invest in children, highlighting the potential positive impact of scrapping the two-child limit on reducing child poverty.
Chancellor Rachel Reeves affirmed her commitment to reducing child poverty and assured that the Government aims to have fewer children in poverty by the end of the parliamentary term.
Regarding gambling taxes, she mentioned initiating an inquiry into gambling taxation and announced plans to outline taxation strategies, including those related to gambling, in the upcoming Budget.
A spokesperson from the Department for Work and Pensions underscored the importance of every child receiving equal opportunities, mentioning the forthcoming publication of a comprehensive strategy by the child poverty taskforce to address the root causes of child poverty.
They highlighted investments in children’s development through initiatives like best start family hubs, extended free school meals, and a new crisis support package to prevent hunger among the most vulnerable children.