HC Deb 30 July 1980 vol 989 cc706-7W
Mr. Ralph Howell

asked the Chancellor of the Exchequer if he will update the reply given to the hon. Member for Norfolk, North, Official Report, 4 May 1978, column 248, showing starting rates of income tax and top rates in each of the United Kingdom, Germany, Netherlands, Canada, Denmark, the United States of America, Belgium, France and Japan.

Mr. Peter Rees

The information requested is given in the table below:

(a) Starting rates of income tax
per cent
UK 30
Germany 18
Netherlands 16–3
Belgium 15
Canada 15
Denmark 144
USA 14
France 7–2
Japan 7

(b) Top rates of income tax
per cent
UK 75
Japan 75
Belgium 72
Netherlands 72
USA 70
France 60
Germany 56
Canada 43
Denmark 39–6

NOTES

1. The rates are those for 1980 (1980–81) except in the case of France and Japan (1979) and Belgium (1978).

2. In all cases the starting rates are the lowest applicable when tax actually becomes payable. All figures relate to a married couple with two dependent children, except for the USA, where the rate shown is that at which a single person starts to pay tax. The starting rate of tax in the USA for a married man with two dependent children is 26–5 per cent., because of the progressive withdrawal of tax credits for such a person at this income level.

3. The top rates of tax shown are the highest charged. In some countries, however, employment income is charged at a lower top rate. For the UK, the rate is 60 per cent., for Japan 67–5 per cent. and for the USA 50 per cent.

4. Local taxes, which are not included in the table, can sometimes make a significant difference. In Denmark, the Copenhagen rate of tax raises the starting rate to 40–4 per cent. and the top rate to 65–6 per cent. In Canada, the Ontario rate of local tax raises the top rate to 61–9 per cent. Japan's top rate becomes 93 per cent. for investment income and 83–7 per cent. for employment income.

5. The rates shown may differ from the nominal rates of tax in the countries concerned, because they take account of any employment income reliefs, minimum expense deductions and other deductions. This is particularly true of Belgium, where the nominal starting rate is 50 per cent.