§ Mr. DobsonTo ask the Chancellor of the Exchequer what is the reduction in annual liability to(a) capital gains tax and (b) capital transfer tax in 1988–89 and 1989–90 as against the 1978–79 indexed regime, specifying in each case the total and average reduction per taxpayer as well as the number of taxpayers in each year.
§ Mr. Norman Lamont[holding answer 16 January 1989]The information requested is given in the table:360W
Capital gains tax Capital transfer tax/Inheritance Tax Reduction, compared with indexed 1978–79 regime, in: Total liability (£m): 1988–89 1,250 610 1989–90 1,150 670 Average liability1(£): 1988–89 1,450 7,200 1989–90 1,500 7,700 Taxpayer numbers(thousands) 1978–79 indexed regime: 1988–89 850 85 1989–90 760 87 Present regime: 1988–89 155 25 1989–90 145 26 1 The reduction in the average liability is calculated using the numbers of taxpayers under the 1978–79 indexed regime. The figures for capital gains tax exclude capital gains realised by companies and taxed within corporation tax. The figures for 1989–90 for the "present regime" assume the same tax structure as in 1988–89 except for indexation of allowances. For each tax, the 1988–89 and 1989–90 tax bases are taken as given. It is not possible to determine to what extent changes to the taxes between 1978–79 and the present may have affected the levels of transfers and disposals.