Chris Leslie writes to Cameron – and calls on him to correct “absurd claim” on Marriage Tax allowance

Dear Prime Minister,

Today at Prime Minister’s Questions, in answer to a question from my colleague Tom Harris MP, you said that “all married couples paying basic rate tax will benefit” from your proposed Marriage Transferable Tax Allowance:

“What I can confirm is that all married couples paying basic rate tax will benefit from this move.”

David Cameron, Prime Minister’s Questions, 9 October 2013

As you ought to have known, this is absolutely false. HM Treasury’s own explanation of the policy confirms this:

“The policy benefits married couples, including same sex married couples and civil partners where one is a basic rate taxpayer (earns below £42,285 in 2015 to 2016) and one has unused personal allowance.”

HM Treasury, 30 September 2013, https://www.gov.uk/government/news/marriage-transferable-tax-allowance-announced-by-government

In other words, all married couples where both partners are paying tax at the basic rate will not benefit from the policy. And as the Institute for Fiscal Studies has pointed out, only 31 per cent of married couples will benefit from this policy.

Later, in a response to a point of order from Ed Balls MP, you said that the married couples’ allowance “is available to every basic rate taxpayer”:

“The point is the married couples’ allowance is available to every basic rate taxpayer.”

David Cameron, Prime Minister’s Questions, 9 October 2013

This is clearly an absurd claim to make. The Marriage Transferable Tax Allowance is only available to basic rate taxpayers whose partners have unused personal allowance. According to HM Treasury, just four million married couples in this situation will benefit – compared to 8.9 million married couples where there is a basic rate taxpayer:

“Over four million couples will benefit from the Transferable Tax Allowance, including 15,000 couples in civil partnerships.”

HM Treasury, 30 September 2013, https://www.gov.uk/government/news/marriage-transferable-tax-allowance-announced-by-government

I would be grateful if you could correct the record, and confirm the following:

•       Not all married couples paying basic rate tax will benefit from the Marriage Transferable Tax Allowance.

•       Most married couples will not benefit from the Marriage Transferable Tax Allowance.

•       The Marriage Transferable Tax Allowance is not available to every basic rate taxpayer.

I look forward to hearing from you.

Yours sincerely,

Chris Leslie MP

Shadow Chief Secretary to the Treasury