HC Deb 16 July 1979 vol 970 cc372-3W
Mr. Ralph Howell

asked the Chancellor of the Exchequer what is the effective rate of income tax plus social security contributions for a married couple—single wage—with two children and on average earnings, in the United Kingdom, France, Germany, the United States of America and Japan.

Mr. Peter Rees,

pursuant to his reply [Official Report, 10 July 1979; Vol. 970. c. 155],gave the following answer:

Information on national average earnings in France, Germany, the United States of America and Japan is not available. A comparison can, however, be made on the basis of the income of an average production worker. This is given in the table below:

EFFECTIVE RATE OF INCOME TAX PLUS SOCIAL SECURITY CONTRIBUTIONS FOR A MARRIED COUPLE WITH TWO CHILDREN
APW's earnings £ sterling Effective rate Per cent.
United Kingdom 4,940 16.3
France 4,880 4.9
Germany 7,270 21.4
USA 6,210 13.8
Japan 7,900 11.1

Notes:

  1. 1. The figures for France, Germany, USA and Japan are United Kingdom Treasury estimates of APW earnings levels as at 1 April 1979 based on the latest—1977—OECD figures for earnings of an average production worker. The figure for the United Kingdom is an estimate of the average wage of a male manual worker in manufacturing industry for March 1979.
  2. 2. All figures relate to the tax year 1979 or 1979–80, except for France—1978—whose income tax rates are fixed in arrear, and the California State income tax—1978—for the USA. The United Kingdom figures take account of the changes proposed by the Chancellor in his Budget.
  3. 3. All income is assumed to be employment income of the husband.
  4. 4. In computing tax liabilities, account has been taken of personal allowances and reliefs, employment income reliefs, minimum deductions for expenses, deductible social security contributions and any other flat rate relief against employment income.
  5. 5. Any child benefit receivable has been set off against income tax, and the resulting net figure expressed as a percentage of gross employment income. This accords with OECD practice.
  6. 6. Currency conversions were made at the exchange rates prevailing on 6 July 1979. The exchange rate between the United Kingdom and overseas countries may not fully reflect differences in consumers' purchasing power between the United Kingdom and those countries.