HC Deb 27 April 1982 vol 22 cc226-7W
Miss Richardson

asked the Chancellor of the Exchequer what would be the net cost in 1982–83 of raising tax thresholds to the level of the 1982–83 (a) ordinary and (b) long-term supplementary benefit adult scale rates plus the estimated average housing costs of supplementary benefit recipients; what these levels would be; and what would be the costs if personal tax allowances were allowed against the standard rate of tax only.

Mr. Ridley

Estimates for 1982–83 are as follows:

Supplementary benefit scale Level of income tax allowance Full year direct cost to revenue at 1982–83 income levels Full year direct cost if allowances allowed against basic rate only
Single married
£ £ £bn £bn
(a) ordinary 2,195 3,075 3.7 3.3
(b) long-term 2,535 3,595 6.4 5.9

The levels of income tax allowances have been calculated from the supplementary benefit rate for a single person or married couple as appropriate, taking account of the increase announced for November 1982, plus provisional estimates of the average housing costs for 1982–83. Dependency additions paid to supplementary benefit recipients with children have been excluded. No adjustment has been made to the wife's earned income allowance; if it were raised to the same level as the single person's allowance, the costs would be increased by £0.7 billion in scheme (a) and £1 billion in scheme (b). It has been assumed that the income tax age allowances would be set at the higher of (i) the 1982–83 levels proposed in the Budget and (ii) the levels shown in the table. The estimates of cost take as their base the levels of allowances proposed in the current Finance Bill.