HC Deb 21 February 1961 vol 635 cc288-9
9. Mr. Jay

asked the Chancellor of the Exchequer what percentage of income was paid in Income Tax and National Insurance contributions together by a man with a wife and one child with income of £9 a week in 1951–52; and what will be the corresponding percentage from July, 1961, on the assumption of present rates of Income Tax.

Mr. Selwyn Lloyd

For 1951–52 a married man with one child under 11 earning £9 a week paid 7.8 per cent. of his income in Income Tax and National Insurance contributions combined. At the present rates of Income Tax and the proposed rates of National Insurance and National Health Service contributions from July, 1961, the percentage would be 6.1.

Mr. Jay

Does not that show that on these levels of income there has been no material reduction in taxation in the last ten years?

Mr. Lloyd

I think it proves the old adage that it is unwise for an advocate to ask a question in cross-examination unless he knows the answer.

10. Mr. Jay

asked the Chancellor of the Exchequer what percentage of income will be paid in Income Tax and National Insurance contributions together from July, 1961, by a man with a wife and one child earning £8, £10 and £12 a week, respectively.

Mr. Selwyn Lloyd

With one child under 11, the percentages are 6.6, 6.6 and 8.8 respectively. It is assumed that there is no other source of income, and that the man is not in non-participating employment for the purposes of the graduated pension scheme.

Mr. Jay

Does that mean that from the level of £10 a week downwards there is no reduction in the total direct taxation paid by taxpayers in this category?

Mr. Lloyd

I do not think that it means that at all.

Mr. Green

Is it not also a fact that social benefits today stand higher than ever before in our history? Are they not widely spread, particularly amongst the lower income ranges?

Mr. Lloyd

It is true, for example, that unemployment benefit is 66 per cent. higher in real terms and retirement pensions at the new rate are over 40 per cent. higher in real terms.

Mr. Jay

Did not the right hon. and learned Gentleman's figure show that the percentage was 6 per cent. in the case of both the £8 a week and the £10 a week taxpayer? Does not that mean that there is no reduction in percentage paid when earnings fall below £10 a week?

Mr. Lloyd

It means that the percentages for the two figures for which the right hon. Gentleman asked are the same.

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