HC Deb 14 June 1978 vol 951 cc579-80W
Mr. Arthur Lewis

asked the Chancellor of the Exchequer if, in view of the Government's policy of assisting families, he will change present taxation policy which penalises with higher taxation married couples as against those who live together and claim separate tax allowances as single people.

Mr. Robert Sheldon

I do not accept that the present tax system generally penalises married couples as compared with two single people. Where a married couple are both working the wife's earned income allowance—equal to the single person's allowance—is available in addition to the married man's allowance. This gives them, under the Budget proposals, allowances totalling £2,520 as compared with £1,970 for two single the percentage of income absorbed by income tax for a married man with two children under 11 years of age earning (a) average weekly earnings, (b) twice average and (c) three times average, and on equivalent sums, based on current exchange rates, in the EEC countries, the USA, Australia and Japan.

Mr. Robert Sheldon

The information requested is as follows:

people. Where the couple are liable to tax at the higher rates it is open to them to elect for the wife's earnings to be taxed separately, so that in relation to their earnings they are treated as two single people. It is only where the couple have substantial investment income that they may pay more tax than single people living together.