HC Deb 27 February 2003 vol 400 c684W
24. Mr. Robathan

To ask Mr. Chancellor of the Exchequer, what estimate he has made of the amount of extra revenue he has received since 1997 from the abolition of ACT dividend credit. [99485]

Ruth Kelly

I take it that the hon. Gentleman is referring to tax credits paid on dividends received by investors.

When we announced the changes to dividend tax credits in July 1997 we estimated that they would increase revenue by amounts of £2.3 billion in 1997–98, £3.95 billion in 1998–99, and around £51.5 billion each year thereafter.

But it is misleading to look at these figures in isolation. The abolition of payable tax credits was part of a wider package of CT reform that reduced rates of corporation tax and encourages re-investment of profits for growth. These reforms will have partly offset the effects of changes to tax credits.

There has been no estimate made of the Exchequer effects since those Budget forecasts.