HC Deb 21 June 1993 vol 227 cc13-4W
Mr. David Nicholson

To ask the Chancellor of the Exchequer if he will give the estimated full-year costs or savings of changing income tax by(a) raising the upper limit of the 20p band to £2,750, (b) raising the 25p rate by 1 p, (c) introducing a 35p in the pound rate for taxable income from £23,700 to £28,700, (d) raising the 40p in the pound rate to 45p on taxable income over £35,000 and (e) introducing a 50p in the pound rate on taxable income over £45,000.

Mr. Dorrell

Latest estimates of the cost or savings of each measure compared with the regime announced in the March 1993 Budget are as follows:

Direct revenue yield ( + ) or cost ( - ) in full year at 1993–94 income levels
£ million
(a) Increasing width of the lower rate band to £2,750 -240
(b) Raising the basic rate of tax by 1 per cent. 1,500
(c) Charging 35 per cent, tax rate on taxable income between £23,700 and £28,700 -330
(d) Charging 45 per cent, tax rate on taxable income in excess of £35,000 1,000
(e) Charging 50 per cent, tax rate on taxable income in excess of £45,000 1,500

The estimates do not allow for any behavioural effect that might result from such changes to the tax system and do not include capital gains tax.