§ Mr. Andrew F. BennettTo ask the Chancellor of the Exchequer (1) when the ceiling for tax exemption on earnings of placement students for periods spent on courses was first set at £5,000;
(2) what will he the level of maximum earnings exempt from tax for placement students during periods on courses for the tax year 1988–89.
§ Mr. Norman LamontIn accordance with the Inland Revenue's statement of practice 4/86—a copy of which I am placing in the Library—payments by employers to employees who are released to attend a full-time further education course are not regarded as taxable if the rate of payment does not exceed the higher of £5,000 a year or the amount payable to someone in similar personal circumstances by a public research body. The 1988–89 rate of £5,000 was introduced with effect from 1983–84; it remains well above the amount which would generally be payable to a single person living away from home by a public research body.