§ Mr. Dodsworthasked the Chancellor of the Exchequer if he will make a detailed statement on the circumstances when a child's earnings affect its parents' tax allowances, stating how many taxpayers have had to pay extra tax over the last five financial years because of the level of their children's earnings.
§ Mr. Robert SheldonChild tax allowance is reduced by the amount by which the child's own taxable income exceeds the statutory limit, which was £115 gross for each of the years 1963–64 to 1975–76. With effect from 1976–77 the limit has been £350, but where the child is under 18 and unmarried and does not have earnings in excess of £235 the tax allowance is reduced if the child's investment income exceeds £115. For 1974–75, 170,000 taxpayers had their allowances reduced in this way, but it is not known to what extent the child's income was earnings, nor in how many further cases the allowances were completely extinguished. Similar information relating to numbers of taxpayers is not available for earlier years, but the number of allowances reduced in this way for 1972–73 was 280,000, and for 1973–74, 190,000.74W Figures for the years 1975–76 and 1976–77 are not yet available.