Family Income and Taxation (Hansard, 27 April 1978)

§ Mr. Peter Bottomley

asked the Chancellor of the Exchequer if he will publish a table showing the total net weekly gain or loss per family and per child, at current prices and at constant prices, for families

1. BETWEEN 1976–77 AND 1978–79
				Net weekly gain (+) or loss (-) for a family with
Marginal tax rate of family	1 child	2 children	3 children	4 children	Gain (+) or loss (-) for first child in family	Gain (+) or loss (-) for each subsequent child
Per cent.	£ per week	£ per week	£ per week	£ per week	£ per week	£ per week
Not liable	…	…	+2.22	+2.93	+3.65	+4.37	+2.22	+0.72
34^*	…	…	…	+0.85	+1.08	+1.31	+1.53	+0.85	+0.23
40	…	…	…	+0.68	+0.86	+1.04	+1.22	+0.68	+0.18
45	…	…	…	+0.49	+0.60	+0.71	+0.82	+0.49	+0.11
50	…	…	…	+0.29	+0.34	+0.38	+0.43	+0.29	+0.05
55	…	…	…	+0.10	+0.08	+0.06	+0.03	+0.10	-0.02
60	…	…	…	-0.09	-0.18	-0.27	-0.36	-0.09	-0.09
65	…	…	…	-0.28	-0.57	-0.85	-1.13	-0.28	-0.28
70	…	…	…	-0.47	-0.95	-1.42	-1.90	-0.47	-0.47
75	…	…	…	-0.67	-1.33	-2.00	-2.67	-0.67	-0.67
83	…	…	…	-0.97	-1.95	-2.92	-3.90	-0.97	-0.97

2. BETWEEN 1976–77 REVALORISED TO 1978–79 PRICES AND 1978–79
				Net weekly gain (+) or loss (-) for a family with
Marginal tax rate of family	1 child	2 children	3 children	4 children	Gain (+) or loss (-) for first child in family	Gain (+) or loss (-) for each subsequent child
Per cent.	£ per week	£ per week	£ per week	£ per week	£ per week	£ per week
Not liable	…	…	+2.34	+2.85	+3.36	+3.87	+2.34	+0.51
34^*	…	…	…	+0.53	+0.30	+0.07	-0.16	+0.53	-0.23
40	…	…	…	+0.29	-0.02	-0.34	-0.65	+0.29	-0.31
45	…	…	…	+0.04	-0.38	-0.80	-1.22	+0.04	-0.42
50	…	…	…	-0.22	-0.74	-1.27	-1.78	-0.22	-0.52
55	…	…	…	-0.47	-1.10	-1.73	-2.35	-0.47	-0.63
60	…	…	…	-0.73	-1.46	-2.19	-2.92	-0.73	-0.73
65	…	…	…	-0.99	-1.98	-2.96	-3.95	-0.99	-0.99
70	…	…	…	-1.24	-2.49	-3.73	-4.97	-1.24	-1.24
75	…	…	…	-1.50	-3.00	-4.50	-5.99	-1.50	-1.50
83	…	…	…	-1.91	-3.82	-5.72	-7.63	-1.91	-1.91
^* 35 per cent. in 1976–77.
Notes:
1. In order to reflect the value of child tax allowances over the income tax year as a whole the figures show the net weekly gain or loss between 1976–77, the last year before the introduction of child benefits, and 1978–79 following the further reduction in child tax allowances. The figures for 1978–79 also include the weekly equivalent of total child benefits received in the whole year, thus reflecting the increase in child benefits from November 1978 until the end of the year.
2. The figures in Section 1 of the Table above show the change in child support between 1976–77 and 1978–79 without allowing for the increase in prices between the two years. In arriving at the figures in Section 2 of the Table above the amount of child support in 1976–77 has been increased to represent its value at 1978–79 prices.
3. The prices index used is the general index of retail prices—all items, for the financial years 1976–77 and 1978–79 in which prices have been assumed to be 7 per cent. higher on average than in 1977–78.
4. Taxpayers have also benefited from the increases in thresholds since 1976–77.
5. It has been assumed that entitlement to family allowance in 1976–77 was renounced by families on marginal rates of 60 per cent. and over.
6. It has been assumed that the children are all under 11 years of age.

668W

with each of one, two, three and four children, as a result of the introduction of child benefits and reduction of child tax allowances in April 1977, the increased charge for school meals in September 1977 and the April 1978 increases in child tax alowances, assuming families below the tax threshold, basic-rate taxpayers, and families with a new marginal tax rate equal to each of the higher rate bands.