Tax and Benefits (Hansard, 2 February 1998)

§ Mr. Cousins

To ask the Chancellor of the Exchequer how many employees face marginal withdrawal rates tax and benefits of(a) 0 per cent. or gains, (b) less than 10 per cent., (c) less than 20 per cent., (d) less than 30 per cent., (e) less than 40 per cent. and (f) less than 50 per cent. if they were (i) to work an hour a week less and (ii) to earn £10 a week less before tax. [22979]

Benefit	Retirement Pension (including SERPS and over 80s additions)	Incapacity Benefit (received for more than 28 weeks of incapacity)
	Yield in a full year from taxing benefit (£ million)	Yield as a percentage of total benefit expenditure	Yield in a full year from taxing benefit (£ million)	Yield as a percentage of total benefit expenditure
1994–95	1,900	7	¹—	¹—
1995–96	2,000	7	30	²—
1996–97	2,100	6	70	1
1997–98	2,100	6	100	1
¹ Incapacity Benefit replaced sickness benefit and invalidity benefit from April 1995.
Prior to that date, both these benefits were not liable to tax.
² Less than 0.5 per cent.
The percentage estimates for incapacity benefit are based on the total benefit expenditure—a large part of which is not liable to tax.