§ 17. Mr. Hardyasked the Chancellor of the Exchequer what is the number of persons paying tax on earned income at the most recent available date and two years earlier.
§ Mr. Patrick JenkinThe latest year for which figures are available is 1969–70, when about 24 million persons with earned income paid tax. The figures for the two preceding years were about 23½ million and 24 million respectively.
§ Mr. HardyIs it not clear that many of those who were taken out of the tax net not long ago will be paving income tax again by the end of the year? In view of this, if the Government's claims are to be justified and the congratulations being given to them are to be deserved, is not early action required, if not merely to create further justice then at least to prevent further over-burdening of the staff of the Inland Revenue?
§ Mr. JenkinIs it the proportion of incomes that is taken in tax that matters, and certainly if we had not made the substantial reductions we have made, reversing the trend of the previous six years, the figure would be much higher. What the hon. Gentleman says is to some extent true, but this is the effect of rising incomes in an inflationary period. This underlines the importance of the Government's campaign against wage-related inflation and of the discussions at present going on at Chequers.
§ Mr. Brian WaldenBefore it gets into all the economic textbooks that the thing which really matters is the proportion of income taken in tax, may I ask the hon. 979 Member to confirm that the important thing is what one defines as a tax? Would he further agree that for the ordinary man what matters are the unavoidable charges on his income, which have not decreased under this Government but have increased?
§ Mr. JenkinI am not sure that the hon. Gentleman's party ever bothered about the proportion. Hon. Gentlemen opposite seem to think that rents, food bills, fares and all these things are to be regarded as taxes. We take a different view.