§ 2. Mr. Hileyasked the Chancellor of the Exchequer what would be the cost to the Exchequer in a full year of raising the exemption from the proposed investment income surcharge from £2,000 to £3,000, £4,000 and £5,000, respectively.
§ Mr. Patrick JenkinAbout £35 million, £55 million and £70 million.
§ Mr. HileyDoes my hon. Friend agree that the taxpayers in this bracket have been hard workers and hard savers and have always been putters-in rather than takers-out, and that it is unfair that they should be discriminated against? If he is not prepared to help all those with savings, is he prepared to make concessions for retired people?
§ Mr. JenkinMy hon. Friend knows that, as a result of the unification of income tax and surtax next year, the first £2,000 of investment income will be taxed at the earned income rate and will be below the point at which the surcharge starts, so that the people to whom my hon. Friend refers will find that they have secured a significant benefit in their tax liabilities next year.
§ Sir Harmar NichollsIs not the term "unearned income", upon which this is based, wrong, and is it not against the best interests of the country that people who save and invest should receive the impression that they are not working in the best interests of the country, and 1166 should not the tax position reflect that to a greater extent?
§ Mr. JenkinMy hon. Friend is absolutely right. As regards nomenclature, I thought I used the phrase "investment income"; the other words have not passed my lips since 18th June, 1970. If my hon. Friend studies table 18 in the Red Book he will see that there are considerable advantages to the people to whom he refers.