§ Mr. DewarTo ask the Chancellor of the Exchequer, pursuant to his answer of 2 April,Official Report, column 479, what is his most recent estimate of the number of taxpayers with gross and taxable incomes within specific income bands.
§ Mr. DorrellLatest estimates for 1993–94 are given in the table.
Thousands Number of taxpayers by range of Gross income1 Taxable income2 Under 5,000 2,100 8,200 5,000 to 10,000 7,800 6,800 10,000 to 15,000 6,100 4,400 15,000 to 20,000 3,900 2,400 20,000 to 25,000 2,000 1,200 25,000 to 30,000 1,100 630 30,000 to 40,000 940 590 40,000 to 50,000 340 210 50,000 to 70,000 250 180 70,000 to 80,000 60 40
Increase in the lower rate band Revenue cost in 1994–95 Revenue cost in a full year Additional numbers of taxpayers with a marginal rate of 20 per cent £ £million £million Males (000s) Females (000s) 100 80 100 60 80 500 400 500 310 450 1,000 780 980 710 860
§ Mr. CormackTo ask the Chancellor of the Exchequer (1) what would be the estimated cost if the higher rate of income tax were levied only on those earning over £45,000 per annum;
(2) what would be the estimated yield if the higher rate of tax were increased to 50 per cent. on those earning over £70,000 per annum.
§ Mr. DorrellHigher rate income tax is charged on taxable income—that is gross income for income tax purposes less those allowances and reliefs, which are available at the taxpayer's marginal rate— in excess of the basic rate limit.
At 1994–95 income levels the estimated full-year cost of increasing the basic rate limit to £45,000 would be £3.4 billion compared with statutory indexation. The yield from the introduction of a 50 per cent. rate on taxable incomes over £70,000 would be about £1.4 billion. These 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.