PM unveils marriage tax breaks plan

Written By Unknown on Sabtu, 28 September 2013 | 15.36

28 September 2013 Last updated at 04:31 ET

Plans for some married couples to get tax breaks worth up to £200 a year have been announced by David Cameron.

The prime minister said four million couples would benefit from a £1,000 transferable tax allowance from 2015.

The move, announced ahead of the Tory conference, comes after a deal with the Liberal Democrats to introduce free school meals for children under eight.

Labour said Mr Cameron was "out of touch" if he thought the people would get married "for £3.85 a week".

The tax break would apply if couples are both basic rate tax payers and would also include 15,000 couples in civil partnerships, from April 2015.

The basic tax rate of 20% is currently in place for up to £32,010 of taxable income. That means that - including a personal allowance - at current rates people would have to earn less than £41,451 a year to be eligible.

'Happiest day'

Benefits from the scheme would come through initially at the end of the tax year in 2016.

Jeremy Hunt

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Jeremy Hunt: "Marriage is special.. it is the institution that particularly helps to strengthen commitment in our society"

Writing in the Daily Mail, Mr Cameron said: "I believe in marriage. Alongside the birth of my children, my wedding was the happiest day of my life.

"Since then, Samantha and I have been a team. Nothing I've done since - becoming a Member of Parliament, leader of my party or prime minister - would have been possible without her.

"There is something special about marriage: it's a declaration of commitment, responsibility and stability that helps to bind families.

"The values of marriage are give and take, support and sacrifice - values that we need more of in this country."

He later tweeted: "The £1000 marriage tax allowance will apply to straight and gay couples, as well as civil partners. Love is love, commitment is commitment."

Election pledge

Mr Cameron said stay-at-home mothers and women who worked part-time would be the main winners.

He promised tax breaks for married couples when he ran for the leadership of his party in 2005, and it was also part of the Conservative election manifesto in 2010.

The Liberal Democrats are opposed to the measure but under the coalition agreement they would not be able to vote against it in any parliamentary vote but could abstain.

It has been suggested the Lib Dems were able to announce plans for every child in England between reception and year two to get free school lunches in exchange for the Conservative's proposed tax break.

The free school meals policy will begin in September next year and will be worth about £437 per child.

Paul Johnson, director of the Institute for Fiscal Studies said: "Each party at their conference has launched a policy that costs about the same - somewhere between half a billion and a billion pounds.

"So the Liberal Democrats had something on free school meals, Labour had something on childcare, the Conservatives have got something on tax allowances.

"Each one is a small lollipop in the context of £25bn of cuts being expected over the following two years - none of them have said much about how they're going to do that."

'All families'

For Labour, shadow chief secretary to the Treasury Rachel Reeves said: "David Cameron's so-called marriage tax break won't even help two-thirds of married couples, let alone millions of people who are separated, widowed or divorced.

"He's so out of touch he thinks people will get married for £3.85 a week.

"And even for the minority who might benefit, it will be far outweighed by what David Cameron's government has already taken away in higher VAT and cuts to child benefit and tax credits."

But Conservative Health Secretary Jeremy Hunt said: "This is a measure that's going to help four million hardworking couples where life is pretty tough. This is going to go to lower earning couples, incidentally, it's not going to go to everyone.

"And I hope it will make a small difference but also send a signal that even though marriage is not for everyone, and there are many different shapes and sizes, different types of families, we recognise the value of this institution to our society."

'Promoting a fantasy'

Tim Yeo, the Conservative MP for Suffolk, told BBC Radio Suffolk that while he welcomed any institutions that support stability in society, in 2013 marriage "is not the only model for a family".

"I don't see why, for example, someone who has been widowed, whether it's a man or a woman, at a young age, and is trying to being up children perhaps on a relatively low income, I regret the fact that the current proposal may exclude those people," he said.

Campaign group Don't Judge My Family criticised the move.

It said the scheme was about "promoting a fantasy 1950s family" and would not benefit many of the families who needed most support.

Dr Samantha Callan, the director of families at the think tank Centre for Social Justice that seeks to address poverty and its causes, welcomed the announcement.

"We've been calling for this since 2007," she said.

"We did a report into the state of the nation and why family breakdown is such a problem in the UK today. Half of all children born today will not still be with both their parents by the time they're 15 and marriage is a more durable relationship."

She added: "Ninety-three percent of all couples still together by the time the child is 15 are married."

The Conservative Party conference takes place in Manchester from Sunday. Mr Cameron will close the conference with his keynote speech on Wednesday.


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