§ Mr. David Mitchellasked the Chancellor of the Exchequer what is the current cost of reducing the maximum rate of income tax on earned income to, respectively, 55 per cent. and 60 per cent. and the estimated current cost of reducing the maximum tax on earned income to 55 per cent. and investment income to a maximum of 70 per cent.
§ Mr. Robert SheldonIncome tax is charged on total taxable income, and there are difficulties in distinguishing tax on earned income from tax on investment income. However, on the arbitrary assumption that earned income forms the bottom slice of any mixed income, the estimated costs of reducing the maximum rate of tax on earned income to 55 per cent. or to 60 per cent. would for 1976–77 be about £165 million and £120 million respectively. The estimated cost of reducing the maximum tax on earned income to 55 per cent. and on investment income to 70 per cent. would be of the order of £450 million, assuming that the maximum rate on investment income took account of the investment income surcharge.
§ Mr. Maddenasked the Chancellor of the Exchequer what is the number of persons paying income tax at the latest available date.
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§ Mr. Robert Sheldon, pursuant to his reply [Official Report, 27th January 1977; Vol. 924, c. 758], gave the following information:
The estimated number of persons paying income tax for the current year, 1976–77, is 25.6 million, counting earning wives separately from their husbands.