What it is with Tories and marriage? Why do they think it is so very important to ‘recognise it in the tax system’?* Fraser Nelson is beside himself – not a nice place to be – about Cameron ‘cowering’ in the face of Labour attacks on this policy.
But for all the supposed dodginess of that dossier, its point about the distributional consequence of Tory plans for sharing tax allowances between married couples is blindingly true, and important. We have very little money to give away. Darling wants it to go to debt reduction**; Brown to mitigating spending cuts (see FT story). Subsidies to the already rich should be even lower in the list of priorities.
Can it really encourage marriage? If merging tax thresholds motivated wedding proposals, you’d wonder what sort of marriage would result. So the tax is all ‘deadweight’ cost. A straight transfer to a favoured, wealthy consitutency. The sort of thing that gives Tories a bad name. In a sense, it answers the FT’s point about Cameron needing to give reasons to vote Conservative, which are evaporating in the face of similarly evaporating pledges on this and that. Here is one: if you are selfish, already well-off, have little need for public services, and like tax cuts, then you will have plenty of reasons to vote Tory.
John Redwood at least sees (some) sense, saying that tax cuts should instead go on matters related to economic production.
UPDATE: The essential figures on this question can be found on LeftFootForward. It also quotes Tim Horton saying: “When we last had a married couples allowance under the Tories during the 1980s and 1990s there was actually a drop off in marriage.” A very good point.
UPDATE 2: And Chris Giles’ piece in the FT is even better. Amongst about 10 brilliant points, “This is pure conjecture, but I don’t think the elasticity of marriage to a tax break is likely to be very high” is the most cutting.
UPDATE 3: A last one. Liberal Bureaucracy explain what Tory tax plans imply about their moral judgments on to your life choices
*Of course, the law used to recognise marriage in other ways that (very) old-style Conservatives would have approved of: by stripping some property rights from women, banning them from certain professions, and so on. I read Mrs Warren’s Profession over the break, with its theme of women being forced into, ahem, unsavoury jobs because of a lack of alternatives. It seems that the institutions of the time left (in the words of GBS):
“a Labor market is infested with subsidized wives and daughters willing to work for pocket money on which no independent solitary woman or widow can possibly subsist. The effect is to make marriage compulsory as a woman’s profession: she has to take anything she can get in the way of a husband rather than face penury as a single woman”
I would worry about any attempts to make marriage artificially remunerative
** “The chancellor argued on Monday that revenue from stronger-than-expected growth should be used to cut borrowing”. I favoured encoding this idea somewhat in A Balancing Act. No one paid any attention.