§ 5. Sir A. Meyerasked the Chancellor of the Exchequer what would be the cost of abolishing investment income surcharge for all taxpayers over the age of 65 years.
§ Mr. Denzil DaviesAbout £150 million for 1977–78.
§ Sir A. MeyerIn view of the relatively low cost of such a change, will the Minister show sympathy for the plight of elderly people whose savings are running out fast and who pray that they will die before their savings vanish altogether? Will he, in the next Budget, give high priority to a move in the direction suggested in my Question?
§ Mr. DaviesThe Labour Government have since 1974 shown a high regard for the priority of looking after the elderly. We have managed to maintain in real terms the income of the elderly, taking inflation into account. The elderly have been treated extremely well if one compares that section of the community with other sections which have suffered from inflation.
§ Mr. Peter ReesDoes the Minister think it right to go on discriminating through the tax system between those who are privileged to retire with occupational pension schemes and those who have to live in retirement on income from savings?
§ Mr. DaviesThe hon. and learned Gentleman speaks of the Government discriminating in this way. I would point out that the principle of taxing earned income differently from unearned income has been accepted by both major parties for a long time. If the Opposition are saying that they do not want to persist with this distinction, they should make it clear.