HC Deb 23 February 1981 vol 999 cc295-6W
Mr. Cook

asked the Chancellor of the Exchequer what extra revenue would be generated by a 5p in the pound increase in tax rates in each of the higher rate bands.

Mr. Peter Rees

The estimated yield in a full year at 1980–81 income levels from increasing all higher rates by 5p—leaving the basic rate unchanged—would be about £230 million.

Mr. Cook

asked the Chancellor of the Exchequer what would be the increase in revenue achieved by introducing the following rates of tax and bands of taxable income, assuming personal tax allowances remain at their 1980–81 cash values: £1 to £9,250 at 30 per cent., £9,251 to £11,250 at 40 per cent., £11,251 to £13,250 at 45 per cent., £13,251 to £16,750 at 50 per cent., £16,751 to £22,250 at 55 per cent., £22,251 to £27,750 at 60 per cent. and over £27,750 at 65 per cent.

Mr. Peter Rees

The yield from introducing the rates of tax and bands of taxable income specified would be about £430 million in a full year at 1980–81 income levels.

Mr. Cook

asked the Chancellor of the Exchequer what would be the cost of introducing a reduced rate tax band (a) of 20 per cent. on the first £1,000 of taxable income, (b) of 25 per cent. on the first £1,000 of taxable income, (c) of 20 per cent. on the first £2,000 of taxable income, and (d) of 25 per cent. on the first £2,000 of taxable income, assuming all other rates and allowances remain unaltered.

Mr. Peter Rees

The full-year cost at 1980–81 income levels of introducing reduced rate bands as specified is given below. It has been assumed that the width of the basic rate band would be reduced by the amount of the reduced rate band, and that, while a separate reduced rate band would be available against a wife's earnings, the higher rate threshold of the couple would remain unaltered.

Full year cost £ million
(a) 20 per cent. on first £1,000 2,380
(b) 25 per cent. on first £1,000 1,190
(c) 20 per cent. on first £2,000 4,300
(d) 25 per cent. on first £2,000 2,150

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