LITRG: ESA could make disabled people poorer

12th March 2010

Tax regulations surrounding the government's employment and support allowance (ESA) may mean disabled people and other groups could see their income lowered, one organisation has claimed.

Introduced in October 2008, the scheme aims to encourage more individuals who are claiming benefits to re-enter the workplace, however, the Low Incomes Tax Reform Group (LITRG) stated the policy has the potential to adversely affect thousands of recipients.

It noted that those who have been on incapacity benefits since April 1995 or before - around 294,000 of the population - will now not receive this financial assistance tax-free.

"The people affected are likely to be among those with the most permanent and difficult disabilities," the body explained.

According to the LITRG, additional complications could see help with council tax, healthcare expenses and prescription charges lost.

The Department for Work and Pensions recently admitted that disabled customers using the ESA system are struggling to complete the forms required to qualify for the initiative.

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