HC Deb 12 July 1966 vol 731 cc1186-7
2. Mr. Onslow

asked the Chancellor of the Exchequer what estimate he has made of the overall economic effect of introducing separate Income Tax assessment for the earnings of married women, taking into account the incentive which this would provide to more married women to take up full- or part-time employment.

The Chancellor of the Exchequer (Mr. James Callaghan)

The special Income Tax reliefs for a wife's earnings already have the effect that over practically the whole field the Income Tax due on her earnings is the same as that for a single person. I am circulating some examples in the OFFICIAL REPORT which show that in the normal case the tax due from a married couple who are both earning is not only less than it would be if the husband earned all the income himself, but also less than At would be if husband and wife were two single persons.

Mr. Onslow

Notwithstanding that reply, since the official denials that a July Budget is to be introduced by the Chancellor make it clear that a July Budget is to be introduced by the Chancellor, will the Chancellor make it plain that he would not rule out some further extension in the Budget he is to introduce shortly?

Dr. Gray

Is my right hon. Friend aware that many tax officers write to men about their wives' Income Tax matters? Will he consider issuing an instruction to all tax officers that they should write to the women concerned about their personal tax matters and not write to their husbands as though they were under permanent tutelage?

Mr. Callaghan

If married women are separately assessed, that procedure should certainly be followed. However, I do not think that this supplementary question arises out of the Question any more than the last supplementary question did.

Following are the examples:

Earnings (per year and per week) Tax paid per annum Tax paid per annum if they were two single persons
Husband Wife Husband Wife Total Tax paid per annum if all the income earned by husband On husband's income On wife's income Total
£ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d.
£520 (£10 a week) £260(£5 a week) 12 17 9 — 12 17 9 70 0 0 45 6 8 — 45 6 8
£780 (£15 a week) £520(£10 a week) 70 0 0 45 6 8 115 6 8 233 1 8 115 15 0 45 6 8 161 1 8
£1,300 (£25 a week) £780 (£15 a week) 233 1 8 115 15 0 348 16 8 483 6 8 282 11 8 115 15 0 398 6 8
£2,080 (£40 a week) £1,040 (£20 a week) 483 6 8 199 3 4 682 10 0 817 0 0 532 16 8 199 3 4 732 0 0
£3,640 (£70 a week) £1,040 (£20 a week) 983 16 8 230 2 1 1,213 18 9 1,348 8 9 1,033 6 8 199 3 4 1,232 10 0