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Earned Income Allowance (Married Women)

Volume 527: debated on Tuesday 4 May 1954

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asked the Chancellor of the Exchequer what the gain would have been to the Exchequer last year if the first £120 of the earnings of married women had not been exempt from Income Tax.

The estimated cost in 1953–54 of the tax relief on the earnings of married women was £85 million, which includes the cost of the separate set of reduced rate reliefs as well as the wife's earned income allowance of £120. It does not follow, how ever, that the Exchequer would benefit by this amount if the reliefs were with drawn, as many married women might stop working.

Is the Minister aware that the proposal to abolish this relief has now received the support of the Committee set up on tax reform, and, at any rate, the revenue from such abolition would be at least sufficient to meet the cost of providing equal pay in all Civil Service Departments, and even relief for married men without families?

I think that the hon. Gentleman has over-simplified the recommendation of the Royal Commission, but I note his view that further tax should be imposed on married women who work.