Saturday, November 23, 2019

Married Couples Tax Allowance - is it 'Discrimination'?

In the Friday evening leaders questions, Jeremy Corbyn described the marriage tax allowance - currently worth £250 to married couples - as a form of discrimination, which he would abolish*.

Is it?

Is the tax on plastic bags discrimination against people who don't use paper bags, large pockets or cardboard boxes?

Is the tax on petrol and diesel discrimination against people who use cars rather than bicycles?

Is the tax on alcoholic drinks discrimination against people who prefer beer to lemonade?

Is a higher rate of tax on people earning £80,000 or above discrimination against the better paid?

Most of the taxes above are attempts to influence behaviour, and raise/redistribute money at the same time. And there is a very good case for influencing the behaviour of couples towards marriage. People who are married report higher satisfaction in the relationship than cohabitees, and cohabiting parents are 3x more likely than married couples to split up before their children reach 5. The high divorce rate comes a distant second to the breakup rate of cohabiting parents. The relative stability of marriage compared to the alternatives is clear, and consistent.

There are other factors - marriage is still the 'done thing' amongst the middle classes, and those with higher education, so there are cultural factors. Also, the financial barriers to marriage which come with the consumer add-ons now considered normal (dress, reception, gifts to the guests) make it prohibitively expensive, ruling it out for most people on low incomes. But despite this, married couples make a public commitment to stability and faithfulness, which when seen through is of huge benefit to the couple, to their children, and to society. So why shouldn't the tax system give this a little bit of encouragement? It's not discrimination, its encouraging beneficial behaviour.


*(Incidentally, the Labour manifesto doesn't refer to this policy, or at least any search for 'marriage' 'couples' 'tax' 'allowance' etc. doesn't find it, but if you've the time to read the whole thing and I'm wrong, then mea culpa. The Lib Dems have the same policy, and their manifesto has it in print).


  1. "People who are married report higher satisfaction in the relationship than cohabitees, and cohabiting parents are 3x more likely than married couples to split up before their children reach 5" Which is chicken and which is egg? Do people with a higher satisfaction marry? Do we really want people marrying for £250/year if they do not want to be married? Or do we think that getting married sprinkles some magic dust on a relationship?

  2. Whatever form it takes, I think we'd want people getting into a relationship, especially one where children are brought into the world, looking to be in a permanent and faithful relationship. In the schools and workplaces I deal with, there is a lot said about setting high expectations, and that the level of expectation (effectively the culture of the place) has a big influence on how well people do. Marriage sets a higher bar for commitment than cohabitation - its more usual for married couples to stay together, and its more usual for cohabiting couples to separate.

    A 5p tax on plastic bags isn't going to bankrupt anyone, but it nudges people (very effectively) towards re-using them. A £250 tax break for married couples isn't going to make a couple think 'right then, we'll get married' but it sends a signal that society values commitment, and thinks this is a good thing to do.

    And if there's a better way to help parents stay together for the whole of their childrens developing years, great, lets find it. But until we do, lets at least encourage the one which is working best at the moment.

  3. Note that the allowance is not something which all married couples get. If one spouse earns too little to pay any tax, then a limited amount of their allowance can be passed to their spouse, who will as a result pay a little less tax. It is not the same as the old married man's [sic] allowance which he received whether his wife worked or not.

    It needs to be claimed. I suspect that many people who are poor do not claim it.