Single income family are taxed more

[kane3000]

Hi, I am sure you have answered this type of question before, but I just can't find it exactly.

Why do a married couple earning say 30,000 each come out with more Net pay (€4200) at the end of the month than a single income family(€3800) where one parent earns 60,000 per annum ?

And another thing, If in the situation of a single income family, where one spouse earns €60,000 - if they can find a way for the other spouse to earn just €1000 a year, the monthly take home increases from €3800 to €4000 ???

 

[ClubMan]

In a word - individualisation.

 

[darag]

Why do a married couple earning say 30,000 each come out with more Net pay (€4200) at the end of the month than a single income family(€3800) where one parent earns 60,000 per annum ?

It makes absolute sense that support for families has shifted from providing tax breaks indescriminately to single-income married couples to direct support using hugely increased child benefit payments. This is a very good thing as it directs the financial benefits much more effectively - people with children under the age of 18 receive relatively more of the benefit while elderly "empty nesters" and childless couples where the non-working spouse is not viewed as providing benefit to society get relatively less. It is also more equitable since it rewards all families equally - tax breaks for married couples reward the wealthy far more than the less well off.

Most well off countries have high female participation in the work force while most poor and backward countries have few if any women working outside the home. A move towards individualisation of the tax system means that women who choose to work are not disadvantaged benefiting society as a whole. I guess the government sees Finland, Sweden, the Netherlands, etc. as models of the sort of societies we should aspire towards instead of the likes of Greece, Mexico and the like.

Most OECD countries have tax systems based on "individualisation". Have a look at [broken link removed] if you are interested in this issue.