Married couples tax break

Married couples tax break

Do not adjust your radio: back to the future

I am still digesting the news that David Cameron has proposed a married couples tax break which has been spun to the press as being worth £1,000. I really thought I had tuned my radio into an announcement transmitted in the late 1950’s which had, mysteriously, taken all this time to reach my DAB radio.  It is a tax allowance, so the net effect, provided both spouses are not higher rate tax payers, will be a saving to the couple of £200 a year.  The papers and news sites were full of it over the weekend:  see The Independent.

I have found myself slowly stewing with anger as the proposal has sunk in.  Why?

Firstly, I have to acknowledge that the proposed tax allowance will be available to gay couples provided they are in a registered civil partnership.  I give credit to the Prime Minister for having previously nailed his colours to the mast of gay marriage and risking the alienation of large swathes of his own party.   So what’s my beef about Dave’s long-promised plans to favour the status of marriage in the tax system?

Here’s what’s rubbing me up the wrong way about the married couples tax break:

  • The message is divisive.  What the proposal says to cohabiting couples is that they are not as important as married couples.  Co-habitees are second class citizens.  I happen to be married.  Does that make me better than the co-habiting person standing next to me in the supermarket check out queue?  Does it mean that I am a better partner to my spouse?  Or a more loving, and attentive, father to my children?  Does it make me a more rounded, more valuable citizen, better able to make an outstanding contribution to the economy, my community and the general well-being of the nation?  The answer, patently obvious to anyone investing more than 3 seconds to the proposition, is a resounding ‘No’.
  • It has ruined the warm glow I had from the announcement by the Lib Dems that every child in England between the reception year and year two would get free school meals.  I was heartened at the time by the Lib Dems’ announcement.  In retrospect, it appears the price of the Lib Dems’ free school meals plan is the free hand given to the Tories to push the married couples’ tax break. (The Lib Dems do not support the tax break but have agreed to abstain in any  Parliamentary vote).
  • It is irrational in the sense that I don’t see it fixing whatever it is the government thinks is wrong with society.  I hear that Mr Cameron is a fan of Nudge theory: that desired changes in behaviour can be achieved by indirect messages rather than beating people over the head with a stick.  The married couples tax break (which will cost £700m a year in lost tax revenue) but is only worth up to £200 a year for a married couple does not seem to me likely to have all those morally lax co-habitees rushing to tie the knot.
  • It is discriminatory.  The 2.9 million people who cohabit in the UK (according to the Office for National Statistics in November 2012) will not feel nudged by this tax discrimination: more likely it will feel like a poke in the eye such is the undiluted message of discrimination that the proposal carries.
  • It punishes children, or at least, is reckless as to the impact upon them.  Yes, I really mean that.  I have railed before about the level of child poverty in this developed society of ours.  Why should the children of married partners get the indirect benefit of this tax break but not the children of co-habitees?  The HM Treasury homepage trumpets its commitment to equality and diversity:

“When making policy, our officials look at the impact a policy might have on protected groups and then consider options to avoid any negative impact on that group.  Ministers are advised of the impact a decision has on protected groups, and this is taken into account when a policy decision is made.”

  • Well, I can’t think of a cohort more worthy of protection than the kids who are on the wrong side of the poverty gap so why should their situation worsen or slightly improve by dint of something they have no control over: their parents’ decision to marry or cohabit?
  • If you are a widow or widower.  Tough.  You miss out.  The married couples tax break is not for you any longer.
  • If you are now divorced, well, you have fallen from your state of married grace. So what if you still have the kids of the marriage to look after?  Hard cheese.  No tax break for you.

What a tawdry, tweedy little policy.  How shabby it looks in the light cast on it by the free school meals announcement.  I suppose co-habitees should at least be grateful that their kids will not be discriminated against at the school dinner table.

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