§ Sir Brandon Rhys Williamsasked the Chancellor of the Exchequer if he will recalculate the figures given in the answer to the hon. Member for Kensington on 23 March 1987, Official Report, column 35, about personal allowances on the basis of the existing income tax rate of 27 per cent., and assuming weekly basic incomes of (a) £10, (b) £11 and (c) £12.
§ Mr. Norman Lamont[pursuant to his reply, 21 October 1987, c. 790]: The yield to the Exchequer of replacing all existing personal allowances with basic incomes of £10, £11 and £12 per week would be £5 billion, £3 billion and nil respectively in a full year at 1987–88 income levels. The offsetting costs from allowing tax discounts on earned and unearned incomes for each individual are estimated to be as follows:
Weekly tax discount on earned income Cost in a full year at 1987–88 income levels (£) (£) 3.00 4 6.00 8 7.50 10 331W
Weekly tax discount on investment income1 Cost in a full year at 1987–88 income levels (£) (£) 3.00 3 6.00 5 7.50 6 21.00 10 30.00 11 1 Assuming that occupational pensions and state retirement pension are treated as investment income.