§ Mrs. Chalker
asked the Secretary of State for Social Services (1) when estimates of the December 1976 figures for working families subject to a 75 per cent. or higher marginal rate of taxation on a pay rise of £1 or more will be available;
(2) how many working families were subject to a marginal tax rate of 75 per cent. or more on a pay rise of £1 at the end of June 1976.
§ Mr. Kinnock
asked the Secretary of State for Social Services in how many poor families face an effective marginal tax rate of (a) up to 25 per cent., (b) up to 50 per cent., (c) up to 75 per cent., (d) up to 100 per cent. and (e) over 100 per cent. for the latest date for which figures are available.
ESTIMATED NUMBERS OF FAMILIES WITH CHILDREN WITH THEORETICAL MARGINAL TAX RATES FOR A £1 PAY RISE, AT DECEMBER 1975. Thousands(rounded) Range of marginal tax rate 0–25 26–50 51–75 76–100 Over 100 Estimated number of families with per cent. per cent. per cent. per cent. per cent. All (a) Relative net resources less than 100 per cent. 60 70 10 None None 140 (b) Relative net resources less than 120 per cent. 70 210 40 20 20 360 (c) All working families 80 5,120 200 40 50 5,480
(i) "Relative net resources" are defined as net weekly income less rent addition divided by the supplementary benefit scale rate times 100. Net weekly income is defined as gross income less tax less national insurance contributions less superannuation contributions less work expenses. Rent addition is defined as, for a householder, the attributable share of rebated housing costs and, for a non-householder, the prevailing supplementary benefit standard addition.404W
Mr Madden asked the Secretary of State for Social Services if he will list the number of low-income families subject to a marginal tax rate of (a) up to 25 per cent., (b) from 26 to 50 per cent., (c) from 51 to 75 per cent., (d) 76 to 100 per cent. and (e) in excess of 100 per cent. for the latest available date.
§ Mr. Deakins
, pursuant to his replies [Official Report, 24th January 1977; Vol. 924, c. 489; 27th January 1977; Vol. 924, c. 727] gave the following information:
The following table gives estimates of the numbers of families with children and with the head in full-time employment or self-employment, who theoretically are subject to the marginal tax rates stipulated by my hon. Friends. Line (a) shows families with incomes below the supplementary benefit level, line (b) families with incomes below 120 per cent. of the supplementary benefit level and line (c) all families.
These estimates are based on analyses by the Department of Health and Social Security of Family Expenditure Survey data, and are subject to sampling error. They are theoretical since it is assumed that means-tested benefits change immediately on a pay rise of £1 and in practice this will not happen in many cases. The figures are therefore liable to mislead if quoted without these qualifications.
(ii) "Marginal tax rates" are a measure of the change in total income support—i.e. gross earnings plus family allowances plus family income supplement plus rent and rate rebates plus the value of free welfare milk and free school meals less national insurance contributions less tax less gross rent and rates less work expenses—which results from an increase in earnings of £1.
(iii) Higher rate taxpayers have been excluded from the table.