Married Couples Tax Allowance due in 2015
By Harry Phibbs
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The Daily Telegraph reports this morning that the Conservative policy of tax relief for marrried couples is back on the agenda. "Tax breaks worth up to £150 to married couples will be written into law by David Cameron before the next election," it reports the Tresaury minister David Gauke as promising.
The report says that "George Osborne’s Spending Review on Wednesday is unlikely to contain any giveaways to support married couples or stay-at-home mothers."
While "the most likely date for the introduction of the tax relief is April 2015", during the next general election campaign" it was "still possible that ministers could legislate for the change in this parliament and delay its implementation."
The Conservative Manifesto was clear:
We will recognise marriage and civil partnerships in the tax system in the next Parliament. This
will send an important signal that we value couples and the commitment that people make when they get married.
The policy survived the Coalition Agreement with this proviso:
We will also ensure that provision is made for Liberal Democrat MPs to abstain on budget resolutions to introduce transferable tax allowances for married couples without prejudice to the coalition agreement.
There is a view - held by Lib Dem politicians and others - that the state should be neutral about marriage. That is a powerful sentiment. However marriage (or the lack of it) is not neutral on the impact it has on the state or on society. The Centre for Social Justice research finds:
Nearly one in two cohabiting parents split up before their child’s fifth birthday, compared to one in twelve married parents
Three-quarters of family breakdown affecting young children now involves unmarried parents.
If you have experienced family breakdown, you are 75% more likely to fail at school, 70% more likely to be a drug addict and 50% more likely to have alcohol problems.
The health gain from marriage has been found to be equivalent from giving up smoking.
In any case many feel that tax system at present punishes marriage (unlike most other developed countries.) It especially punishes the traditional family arrangement where the husband goes out to work, often long hours, and his wife stays at home to look after the children. Why should this couple get a smaller tax allowance than if they both worked part time?
Others will object that people should not get married for love not financial reasons - and scoff that £150 a year should make a difference. Yet when a couple decide to marry they understand that love is not enough, they also need to sort out practical arrangements. Money does come into it. £150 a year might not be much to the rich but it is to the poor. Often it is finance which puts marriages, or the prospect of marriage, under strain.
If the Daily Telegraph report is accurate this issue will be rather topical in the next election campaign. I would suspect that the Conservatives having estalished the principle will promise to go further. Labour and the Lib Dems will oppose it as an old fashioned way of helping smug rich people. Yet in refusing to back marriage in a tangible way it is Labour and the Lib Dems who prove themselves out of touch in helping the vulnerable.
Many Labour and Lib Dem voters back this Conservative policy. In January a YouGov poll found 53% to 36% support for married couples tax allowance. Among Lab voters support is 46% to 44%. Among Lib Dems it was even at 47% for and 47% against.