HC Deb 28 January 1992 vol 202 cc488-90W
Mr. Battle

To ask the Chancellor of the Exchequer (1) if he will estimate the effect on Treasury revenues in a full year in(a) 1991–92 and (b) 1992–93 of introducing an upper limit on all income tax allowances and reliefs of (i) £10,000, (ii) £15,000 and (iii) £20,000 a year, limiting all personal tax allowances except the single person's allowance and relief on contributions to personal pensions to the basic rate, with a 50 per cent. income tax band on taxable incomes of (1) £31,705 and above, (2) £33,705 and above, (3) £36,705 and above, (4) £38,705 and above, (5) £41,705 and above, (6) £43,705 and above, (7) £66,705 and above and (8) £76,705 and above, giving the total revenue in each case and the numbers of people affected;

(2) if he will estimate the effect on Treasury revenues in a full year in (a) 1991–92 and (b) 1992–93 of introducing an upper limit on all income tax allowances and reliefs of (i) £10,000, (ii) £15,000 and (iii) £20,000 a year, and limiting all personal tax allowances except the single person's allowance to the basic rate, with relief on contributions limited to personal pensions to the basic rate, and relief on employees' contributions to occupational pension schemes limited to the basic rate, with a 50 per cent. income tax band on taxable incomes of (1) £31,705 and above, (2) £33,705 and above, (3) £36,705 and above, (4) £38,705 and above, (5) £41,705 and above, (6) £43,705 and above, (7) £66,705 and above and (8) £76,705 and above, giving the total revenue in each case and the numbers of people affected;

(3) if he will estimate the effect on Treasury revenues in a full year in (a) 1991–92 and (b) 1992–93 of introducing an upper limit on all income tax allowances and reliefs of (i) £10,000, (ii) £15,000 and (iii) £20,000 a year, and limiting relief on contributions to personal pensions and occupational pension schemes to the basic rate, and limiting of all personal tax allowances except the single person's allowance to the basic rate, and with a 50 per cent. income tax band on taxable incomes of (1) £31,705 and above, (2) £33,705 and above, (3) £36,705 and above, (4) £38,705 and above, (5) £41,705 and above, (6) £43,705 and above, (7) £66,705 and above and (8) £76,705 and above, giving the total revenue in each case and the numbers of people affected.

Mr. Maude

[holding answer on 21 January 1992]It is estimated that at 1991–92 levels of income the introduction of the upper limits specified would yield the following.

Yield following restriction of specified allowances and relief on contributions to personal pensions to the basic rate (£ million)
50 per cent. taxable income thereshold Upper Limit for total allowances and reliefs
£10,000 £15,000 £20,000
£31,705 470 200 120
£33,705 470 200 120
£36,705 470 200 120
£38,705 470 200 120
£41,705 470 200 120
£43,705 470 200 120
£66,705 470 200 120
£76,705 460 200 120
Yield following restriction of specified allowances and relief on contributions to occupational pension schemes limited to the basic rate (£ million)
50 per cent. taxable income threshold Upper limit for total allowance and reliefs
£10,000 £15,000 £20,000
£31,705 540 240 150
£33,705 540 240 150
£36,705 530 240 150
£38,705 530 240 150
£41,705 530 240 150
£43,705 530 240 150
£66,705 520 230 140
£76,705 520 230 140
Yield following restriction of specified allowances and relief on contributions to personal pensions and occupational pensions to the basic rate (£ million)
50 per cent. taxable income threshold Upper limit for total allowances and reliefs
£10,000 £15,000 £20,000
£31,705 450 190 120
£33,705 450 190 120
£36,705 450 190 120
£38,705 450 190 120
£41,705 450 190 120
£43,705 450 190 110
£66,705 440 190 110
£76,705 440 180 110

The number of people with total allowances and reliefs in excess of £10,000 is about 635,000. The corresponding figures for £15,000 and £20,000 are about 75,000 and 35,000 respectively.

The estimates of revenue yield do not take account of any behavioural effects which might result from the introduction of such a limit.

It is not possible to provide corresponding detailed estimates for 1992–93.

Mr. Battle

To ask the Chancellor of the Exchequer if he will estimate the effect on Treasury revenues in a full year in(a) 1991–92 and (b) 1992–93 of introducing an upper limit on all income tax allowances and reliefs of (i) £10,000, (ii) £15,000 and (iii) £20,000 a year, with a 50 per cent. income tax band on taxable incomes of (1) £31,705 and above, (2) £33,705 and above, (3) £36,705 and above, (4) £38,705 and above, (5) £41,705 and above, (6) £43,705 and above, (7) £66,705 and above and (8) £76,705 and above, giving the total revenue in each case and the numbers of people affected.

Mr. Maude

[holding answer 21 January 1992]After the introduction of a 50 per cent. tax band the estimated further yield from imposing the specified limits would be as follows:

Full year yield at 1991–92 income levels
Threshold for 50 per cent. tax Limit for total allowances and reliefs
£10,000 £15,000 £20,000
£31,705 710 290 170
£33,705 700 290 170
£36,705 700 290 170
£38,705 700 290 170
£41,705 690 290 170
£43,705 690 290 170
£66,705 660 280 170
£76,705 650 280 170

The number of people with total allowances and reliefs in excess of £10,000 is about 635,000. The corresponding figures for £15,000 and £20,000 are about 75,000 and 35,000 respectively.

It is not possible to provide corresponding detailed estimates for 1992-9–.