Taxation Revenue (Hansard, 7 December 1994)

§ Mr. Chidgey
To ask the Chancellor of the Exchequer what proportion of total Government taxation revenue was raised by the taxation of inherited wealth and income in each year since 1979.
263W

§ Sir George Young
The information requested is given in the table. Inheritance tax is charged on estates passing on death, and on certain lifetime gifts and settled property.

Financial year Inheritance tax¹ as a percentage of total government taxation²

1979–80 0.6

1980–81 0.5

1981–82 0.5

1982–83 0.5

1983–84 0.5

1984–85 0.5

1985–86 0.6

1986–87 0.7

1987–88 0.7

1988–89 0.6

1989–90 0.7

1990–91 0.6

1991–92 0.6

1992–93 0.6

1993–94 0.6

Footnotes:

¹ Includes small residual receipts from estate duty and receipts from capital transfer tax. Estate duty was replaced by capital transfer tax in 1975 which was in turn replaced by inheritance tax in 1986.

² Taxes on income, on expenditure, on capital, rates/community charge/council tax, royalties and social security contributions.

§ Mr. Betts
To ask the Chancellor of the Exchequer if he will estimate the direct revenue yield in a full year at 1994–95 levels of income from restricting (a) personal allowances, (b) relief from pension contributions and (c) other reliefs to relief at (i) 25p and (ii) 20p, giving in each case the number of people affected.

§ Sir George Young
Estimated full-year yields at 1994–95 income levels based on a projection of the 1992–93 survey of personal incomes and other survey data in line with the assumptions in the "Financial Statement and Budget Report 1995–96" are given in the table. The figures do not take account of any behavioural effects which might result from the introduction of such changes, and show the yield from restructuring each allowance or relief separately. If two or more were restricted the total yield would be greater than the sum of individual figures.

Restriction to

Basic Rate 20p

Effect of restricting Yield £ million Numbers affected millions Yield £million Numbers affected millions

(a) Personal allowances 1,450 3.3 5,600 26.1

(b) Relief for pension contributions 680 1.9 1,330 11.5

(c) Other reliefs 140 0.7 n/a¹ n/a

¹ Information on reliefs given at source is not available from the Survey of Personal Incomes so it is not possible to estimate the effect of restricting other reliefs to 20 per cent.

Financial year	Inheritance tax¹ as a percentage of total government taxation²
1979–80	0.6
1980–81	0.5
1981–82	0.5
1982–83	0.5
1983–84	0.5
1984–85	0.5
1985–86	0.6
1986–87	0.7
1987–88	0.7
1988–89	0.6
1989–90	0.7
1990–91	0.6
1991–92	0.6
1992–93	0.6
1993–94	0.6
Footnotes:
¹ Includes small residual receipts from estate duty and receipts from capital transfer tax. Estate duty was replaced by capital transfer tax in 1975 which was in turn replaced by inheritance tax in 1986.
² Taxes on income, on expenditure, on capital, rates/community charge/council tax, royalties and social security contributions.

	Restriction to
	Basic Rate	20p
Effect of restricting	Yield £ million	Numbers affected millions	Yield £million	Numbers affected millions
(a) Personal allowances	1,450	3.3	5,600	26.1
(b) Relief for pension contributions	680	1.9	1,330	11.5
(c) Other reliefs	140	0.7	n/a¹	n/a
¹ Information on reliefs given at source is not available from the Survey of Personal Incomes so it is not possible to estimate the effect of restricting other reliefs to 20 per cent.