The 10 per cent increase from 50 was part of a package of measures which also included a rise in the proportion of costs covered by the childcare element of the Working Tax Credit, and a rise in maternity and paternity pay from 106 to 108.85 a week.
John Woodward, managing director of the Busy Bees nursery chain - one of the largest providers of childcare vouchers - welcomed the increased exemption as a sign that the voucher system is popular among employers and employees. He said Busy Bees now works with 4,500 employers and around 40,000 parents receiving vouchers.
'We believe the exemption should ultimately be 100 a week, because that would give a pretty equal balance between the benefits for higher rate and basic rate taxpayers,' Mr Woodward added, insisting that anything higher would tilt support too much in favour of higher rate payers.
Anne Ross, corporate business manager of the other large voucher provider, Accor Services, said it now works with more than 3,000 employers. It recently set up an 'estimator' for its client parents which allows them to feed in their personal details and ensure that obtaining vouchers will not affect any state benefits they are receiving.
In an analysis of the budget, Anne Redston of the Chartered Institute of Taxation warned that lower income families could end up worse off if they took vouchers. But Mr Woodward and Ms Ross both said their voucher companies urged parents to check with their tax credit office.
The maximum eligible childcare costs in the childcare element of the working tax credit remains at 175 per week for families with one child and 300 a week for those with two or more children. But the proportion of costs covered rises from 70 per cent to 80 per cent on 6 April.
Other Budget measures included an extension of the New Deal for Lone Parents pilots to ease parents' return to work, including help with childcare; an increase in the Child Trust fund of either 250 or 500 when a child reaches the age of seven; a rise in the child element of the Child Tax Credit at least in line with average earnings up to the year 2009-2010; and increases in child benefit.
While welcoming the Budget commitments, Anne Longfield, chief executive of the charity 4Children, warned, 'We believe a doubling of investment in childcare by Government over the next five years to 13 billion is imperative, or all the progress made could be lost.'
Christine Walton, chief executive of the Daycare Trust, said that the policy review of children and young people prior to the 2007 comprehensive spending review 'must include a review of funding for the whole early education and childcare system, focusing on increasing funding direct to providers, so that childcare is available for all children irrespective of whether parents work or not'.
