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PM faces marriage tax breaks revolt
David Cameron faces a fresh backlash from Tory backbenchers after it emerged that marriage tax breaks will not be included in next month's Budget.
Senior Government sources have also dismissed calls for George Osborne to be sacked - insisting he will still be Chancellor at the 2015 general election. The developments came amid fevered speculation over plots against the Prime Minister, with suggestions rebels have set a deadline of summer 2014 for the party's electoral fortunes to turn around.
Meanwhile, some MPs are said to be circulating a letter demanding that Mr Osborne is replaced as the economy continues to falter.
The Conservative general election manifesto pledged to introduce a marriage tax break, and the commitment was included in the coalition agreement. It is expected that one member of a married couple or civil partnership would be allowed to transfer £750 of their tax-free personal allowance to their partner, reducing their tax bill. This would be worth around £150 a year to basic-rate taxpayers.
However, the government's failure to bring in the tax breaks so far has angered many in the party. A number of backbenchers have suggested the change should be included in Mr Osborne's Budget next month in return for their supporting controversial plans to introduce gay marriage.
But a senior Government source flatly rejected the idea of a "quid pro quo" deal, and ruled out a marriage tax break featuring in this Budget. "It won't be in the Budget but it will be in this Parliament," the source said. "This Budget obviously, with all that has happened in recent weeks and months, will be very much focused on growth in the economy".
Mr Cameron views the introduction of same-sex marriage - which is expected to split his MPs when it is put to a Commons vote next week - as the "Conservative Party delivering the promise it made".
"This is a difficult issue for some in the Conservative Party and he understands the strong feelings that people have, and of course it's a free vote," the source said. "He is proud of the fact that it's a coalition government with strong Conservative participation that is bringing forward a modern and progressive change. It is good to encourage people to come together and stay together."
The source also made clear that Mr Osborne had the "full confidence" of the Prime Minister. "He is an extremely successful Chancellor. He is battling very difficult economic circumstances," the source said. "George Osborne will be Chancellor at the next general election."
Matthew Sinclair, chief executive of the TaxPayers' Alliance, said: "Our complicated tax system makes it harder for people to start a family and often discriminates against married couples. Introducing an allowance that lets families share some of their personal allowance would help tackle poverty and reduce the perverse disincentives created by our dysfunctional tax code. The Government could go much further and reform our tax system to help everybody who is struggling with the cost of living, not just married couples."