§ Mr. Chris SmithTo ask the Chancellor of the Exchequer if, further to the answer to the hon. Member for Oxford, East (Mr. Smith)Official Report, 14 March, column 429, he will indicate on what basis the figure of £270 million reduction in tax take due to debt write-down has been calculated; and what profit level has been assumed in arriving at this figure.
§ Mr. Norman LamontThe estimate was arrived at by comparing the tax paid in 1987–88 with the estimated 415W amounts that would have been paid if no deduction had been available in respect of losses on irrecoverable loans in the tax computations for the relevant accounting periods. The calculations are based on the taxable profits of individual banks for the relevant accounting periods where these have been agreed, and on estimated figures where tax computations have not been finalised.