HC Deb 21 February 1978 vol 944 cc621-5W
Mr. Rooker

asked the Chancellor of the Exchequer what were the reductions in come tax following all changes in 1977 finance legislation for the following earnings levels, specifying separate figures for a single person, a married couple and a married couple with two children under 11 years of age: £2,000, £4,000, £6,000, £7,000, £7,700, £8,800, £9,200, £9,420, £10,000, £10,900, £11,200, £13,200, £15,000, £16,000, £18,675, £19,425, £19,675, £21,175, £23,000, £31,000, £35,000, and £63,000, showing in each case the gross pay equivalents of these changes on an annual, weekly and percentage basis.

Mr. Robert Sheldon

, Pursuant to his reply—[Official Report, 16th February 1978; Vol. 944, c. 353]—gave the following information:

The figures are as follows:

Gross earnings equivalent of increase in net income
(a) (b) (c)
Annual earnings Reduction in income tax Annul Weekly As percentage of gross earnings
£ £ £ £ Per cent.
9,420 … … … 484.99 1,191.85 22.92 12.7
10,000 … … … 536.49 1,377.83 26.50 13.8
10,900 … … … 604.24 1,699.97 32.69 15.6
11,200 … … … 624.99 1,785.69 34.34 15.9
13,200 … … … 743.49 2,478.30 47.66 18.8
15,000 … … … 846.24 3,167.96 60.92 21.1
16,000 … … … 868.99 3,458.96 66.52 21.6
18,675 … … … 937.49 4,380.53 84.24 23.5
19,425 … … … 937.49 4,733.47 91.03 24.4
19,675 … … … 937.49 4,851.12 93.29 24.7
21,175 … … … 944.69 5,557.00 106.87 26.2
23,000 … … … 1,047.09 6,159.35 118.45 26.8
31,000 … … … 1,047.09 6,159.35 118.45 19.9
35,000 … … … 1,047.09 6,159.35 118.45 17.6
63,000 … … … 1,047.09 6,159.35 118.45 9.8
3. MARRIED COUPLE WITH 2 CHILDREN AGED UNDER 11
2,000 … … … 94.88 247.90 4.77 12.4
4,000 … … … 114.88 281.65 5.42 7.0
6,000 … … … 134.88 287.51 5.53 4.8
7,000 … … … 167.13 393.42 7.57 5.6
7,700 … … … 241.38 551.26 10.60 7.2
8,800 … … … 340.89 844.76 16.25 9.6
9,200 … … … 369.19 946.10 18.19 10.3
9,420 … … … 391.19 1,028.60 19.78 10.9
10,000 … … … 440.24 1,223.73 23.53 12.2
10,900 … … … 445.54 1,532.26 29.47 14.1
11,200 … … … 460.54 1,617.97 31.11 14.4
13,200 … … … 567.34 2,243.63 43.15 17.0
15,000 … … … 664.14 2,839.56 54.61 18.9
16,000 … … … 705.19 3,203.76 61.61 20.0
18,675 … … … 761.99 3,830.53 73.66 20.5
19,425 … … … 761.99 4,183.47 80.45 21.5
19,675 … … … 761.99 4,301.12 82.71 21.9
21,175 … … … 761.99 5,007.00 96.29 23.6
23,000 … … … 852.87 5,781.59 111.18 25.1
31,000 … … … 852.87 5,781.59 111.18 18.7
35,000 … … … 852.87 5,781.59 111.18 16.5
63,000 … … … 852.87 5,781.59 111.18 9.2

The gross earnings equivalents represent the increases in gross earnings that would have been required under 1976–77 income tax rates and allowances to give the same increase in income after tax and national insurance contributions as was given in 1977.

For the married couple with two children account has been taken of the replacement of family allowance by child benefits and the consequent reduction of child tax allowances; for 1977–78 net income includes child benefits, and for 1976–77 family allowance except where gross earnings exceed £10,000 (in which case it would have been advantageous not to claim family allowance).

Mr. Rooker

asked the Chancellor of the Exchequer what is his estimate of the total number of people taken out of income tax following changes in 1977–78; how many are consequently liable to income tax; and if he will distinguish between earning wives and others in his answer.

Mr. Robert Sheldon

, pursuant to his reply [Official Report, 16th February 1978; Vol. 944, c. 354], gave the following information:

The estimates of the number of people taken out of liability to income tax following all changes in 1977–78 are as follows:

Nos. ('000)
Total 2,100
of which earning wives 700

Following the changes, the numbers of people liable to income tax are estimated to be:

Total 24,700
of which earning wives 4,500