The term "couple penalty" refers to the fact that state support under the previous government was means-tested against the joint income of a couple, rather than an individual's own income. This meant that cohabiting couples were likely to receive less support in tax credits than if they were living apart.
The Conservatives had originally pledged to end the penalty for all couples in its pre-election manifesto. But in the new government document published today, The Coalition: our programme for government, the pledge has been scaled back committing only to "bring forward plans to reduce the couple penalty".
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