HC Deb 23 December 1981 vol 15 cc434-5W
Mr. Peter Bottomley

asked the Chancellor of the Exchequer what would he the saving in the financial year 1982–83 if only the first £1,375 of the married man's tax allowance were uprated in line with the increase in the retail price index under the formula introduced in section 22(2) of the Finance Act 1977, assuming that that increase is (a) 12 per cent., (b) 12.5 per cent, and (c) 13 per cent.

Mr. Ridley

Compared with the cost of indexing income tax allowances and bands by the specified percentages under the statutory procedure laid down in section 24 of Finance Act 1980, the saving in a full year at 1981–82 income levels would be as follows:

£ million
(a) 12 per cent, increase 350
(b) 12.5 per cent, increase 350
(c) 13 percent, increase 390

The estimates also include the yield from indexing only that part of the aged married allowance equivalent to the aged single allowance. The effect of the provision for rounding of the increase in the allowances is to produce the same figure for a 12 per cent. as for a 12½ per cent. increase.