Labour to scrap tax break for married couples says Ed Balls

[dutchman]

Labour will scrap the tax break for married couples if it wins next year’s general election, Ed Balls has said.


The happy couple: Mr and Mrs Balls

The shadow chancellor said that a Labour government would end the transferable tax allowance for married couples, which benefits around four million people and is worth £200 a year.

Mr Balls said the measure is “perverse and unfair” and said he would instead use the money to help fund the reintroduction of the 10p income tax rate.

The flagship Conservative measure would only go to a third of married couples and just one in six families with children, Mr Balls claimed.

The plan was announced by David Cameron at the Conservative party conference last year and was hailed by Tory backbenchers.

Traditional Conservatives had been pushing for the marriage tax allowance since the Coalition was formed in 2010.

Under the plans, a husband or wife will be allowed to transfer £1,000 of their tax-free personal allowance to their spouse.

However, Mr Balls said Labour will instead “give a tax cut for all middle and lower income families”.

“We propose a new 10p starting rate of income tax,” he told the BBC. “It's better than the personal allowance, because it's better for work incentives, it would help two-thirds of married couples, it would help women as well as men, families with children.

“Let's cut taxes for working families, and let's ease this cost-of-living crisis rather than carrying on pandering to Tory backbenchers with tax cuts that are unfair and don't make sense.”

The marriage tax plan was part of a deal with the Liberal Democrats, who had criticised the married couples' tax break in opposition but agreed to the measure in order to press ahead with Nick Clegg's plan to offer free school meals to infant school children.

Government sources said that Mr Balls’ plan would leave a £1.5 billion black hole in the budged, claiming that scrapping marriage tax would save £495million but that introducing the 10p income rate would cost £2billion.

A source said: “Once again Ed Balls’ sums simply don’t add up. His latest gimmick would mean £1.5 billion more spending, more borrowing and more taxes to pay for it.

“Nothing changes – it’s the same old Labour with no long-term economic plan to secure a better future for Britain.”

[rebbonk]

scrap the tax break for married couples

The one thing he's said that I agree with, though I realise that many won't agree with it.