§ Mr. David Young
asked the Chancellor of the Exchequer what is his latest estimate of the tax income lost to the Exchequer of by reason of the level of unemployment.
§ Mr. Peter Rees
No satisfactory estimate can be made, since the income tax payable by all the unemployed if they were in work would depend on the amount of their earnings, their tax allowances and on any other income they might have. An article in the February 1981 issue of the "Economic Progress Report"—available in the House of Commons Library—gives estimates of the income tax and other direct costs to the Exchequer of a typical increase of 100,000 in the number of people out of work in the private sector in 1980–81. For reasons explained in the article, it would not be appropriate to gross those costs up to estimate the tax cost of the present level of unemployment.