The low employment rate and a wide range of a material poverty among families with children are serious economic problems in Poland. Introducing the 2007 tax child credit significantly increased a value of social transfers allocated to families with children. However it did not help to resolve any out of the three social policy objectives postulated by Blundell. The main drawback of the tax credit is allocating of benefits to relatively reach families. A modification of the tax credit is presented in a paper. A new tax credit is similar to employment contingent transfers and it provides benefits to families at risk of poverty at the expense of loss of income by families. Income situation of poor working families will improve and financial incentives for parents will increase as results of suggested change.
Leszek Morawski, Uniwersytet Warszawski, Wydział Nauk Ekonomicznych. ul. Dluga 44/50, 00-241Warszawa, Poland
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