§ Mr. Marlowasked the Chancellor of the Exchequer if he will estimate the effect, both fixed and otherwise, of increasing the married person's allowance by the amount of the single person's allowance when only one partner is in employment and at the same time cancelling the single person's allowance and leaving the married person's allowance as it is if both partners are in employment.
§ Mr. Peter Rees[pursuant to his reply, 25 June 1981, c. 140]: Given the present numbers of couples with one partner and with both partners in employment, the net effect on revenue in a full year at 1981–82 income levels would be a yield of at least £300 million.
There would be a revenue cost of around £2,200 million in increasing the allowance of couples where the wife is 250W not in employment by £1,375, the current amount of the single person's allowance. No change would be involved in the case of a wife whose husband is not in employment as she can already claim his allowance.
The yield from abolishing the wife's earned income allowance if both partners are in employment would be at least £2,500 million—assuming the wife's earnings election was abolished. The precise amount cannot be estimated as such a change would bring into tax many wives whose earnings are so small that they are not currently included in tax records.
The long-term effects of such a change on the employment pattern of married couples and hence on tax revenues cannot be quantified but could be substantial.