HC Deb 09 April 1957 vol 568 cc110-5W
Mr. H. Wilson

asked the Chancellor of the Exchequer if he will publish in the OFFICIAL REPORT figures showing, for single persons and married persons with two children, respectively, the change in the real burden of taxation between 1938–39 and 1956–57, respectively, showing actual liabilities in 1938–39, the 1956–57 equivalent liabilities, the actual liabilities in 1956–57, and the tax liabilities as a percentage of income in a manner comparable with Tables A and C of pages 81 and 83 of Command Paper No. 9105.

Mr. P. Thorneycroft

Tables comparable with those on pages 81 and 83 of Cmd. 9105 are given below. In these tables the "Equivalent post-war income" and "Post-war equivalent liabilities" have been calculated by multiplying the 1938–39 figures by 2.65, the rise shown by the Consumer Price Index. Tables on this basis, however, do not in my opinion give a fair view of the changes in the real burden of taxation since they fail

SINGLE PERSONS
Income 1938–39 Tax rates 1956–57 Tax rates Tax liabilities as a percentage of income
Prewar income Equivalent post-war income Actual liabilities Post-war equivalent liabilities Actual liabilities Increase in relation to 1938–39 1938–39 1956–57
£ £ £ s. d. £ s. d. £ s. d. per cent. per cent. per cent.
100 265 — — 8 4 0 — — 3.1
125 331 — — 20 7 10 — — 6.2
150 398 1 13 4 4 8 4 32 15 4 642 1.1 8.2
175 464 3 6 8 8 16 8 46 1 0 421 1.9 9.9
200 530 5 0 0 13 5 0 63 7 6 378 2.5 12.0
225 596 6 13 4 17 13 4 80 14 0 357 3.0 13.5
250 663 8 6 8 22 1 8 99 13 2 351 3.3 15.0
275 729 10 0 0 26 10 0 121 9 6 358 3.6 16.7
300 795 12 12 6 33 9 1 143 5 10 328 4.2 18.0
325 861 18 2 6 40 8 7 165 2 2 244 5.6 19.2
350 928 23 12 6 62 12 1 187 5 1 199 6.8 20.2
375 994 29 2 6 77 3 7 209 1 5 171 7.8 21.0
400 1,060 34 12 6 91 15 1 230 17 9 152 8.6 21.8
425 1,126 40 2 6 106 6 7 252 14 1 138 9.4 22.4
450 1,193 45 12 6 120 18 1 274 17 0 127 10.1 23.0
475 1,259 51 2 6 135 9 7 296 13 4 119 10.8 23.6
500 1,325 56 12 6 150 1 1 318 9 8 112 11.3 24.0
625 1,656 84 2 6 222 18 7 427 18 0 92 13.5 25.8
750 1,988 111 12 6 295 16 1 537 12 10 82 14.9 27.0
875 2,319 139 2 6 368 13 7 706 14 6 92 15.9 30.5
1,000 2,650 166 12 6 441 11 1 884 5 0 100 16.7 33.4
1,250 3,313 221 12 6 587 6 1 1,264 11 0 115 17.7 38.2
1,500 3,975 276 12 6 733 1 1 1,661 15 0 127 18.4 41.8
1,750 4,638 345 7 6 915 4 10 2,091 9 0 129 19.7 45.1
2,000 5,300 414 2 6 1,097 8 7 2,536 15 0 131 20.7 47.9
2,250 5,963 498 10 0 1,321 0 6 3,000 17 0 127 22.2 50.3
2,500 6,625 582 17 6 1,544 12 4 3,495 10 0 126 23.3 52.8
5,000 13,250 1,607 17 6 4,260 17 4 8,951 15 0 110 32.2 67.6

to show the changes in the net income after tax and take no account of the wide variations in the increase in gross income at different levels and in different walks of life. I accordingly append a further table showing the net income now required to maintain the purchasing power of the pre-war net income and the actual net income now available (a) on the assumption that incomes have trebled at all levels (the figure for earnings in the industries covered by the periodic inquiries by the Ministry of Labour, for adult male workers, is nearly 3½times pre-war) and (b) assuming that the higher incomes have only doubled (which would be broadly in line with the recent report of the Royal Commission on the Civil Service).

MARRIED MAN WITH TWO CHILDREN
Income 1938–39 Tax rates 1956–57 Tax rates Tax liabilities as a percentage of income
Prewar income Equivalent post-war income Actual liabilities Post-war equivalent liabilities Actual liabilities Increase in relation to 1938–39 1938–39 1956–57
£ £ £ s. d. £ s. d. £ s. d. per cent. per cent. per cent.
225 596 — — 2 12 11 — — 0.4
250 663 — — 10 9 5 — — 1.6
275 729 — — 22 13 3 — — 3.1
300 795 — — 34 17 0 — — 4.4
325 861 — — 49 0 3 — — 5.7
350 928 — — 66 12 0 — — 7.2
375 994 — — 83 18 5 — — 8.4
400 1,060 1 13 4 4 8 4 103 7 9 2,241 0.4 9.8
425 1,126 3 6 8 8 16 8 125 4 1 1,317 0.8 11.1
450 1,193 5 0 0 13 5 0 147 6 11 1,012 1.1 12.4
475 1,259 6 13 4 17 13 4 169 3 3 858 1.4 13.4
500 1,325 8 6 8 22 1 8 190 19 8 765 1.7 14.4
625 1,656 29 2 6 77 3 7 300 7 10 289 4.7 18.1
750 1,988 56 12 6 150 1 1 410 2 10 173 7.6 20.6
875 2,319 84 2 6 222 18 7 579 4 6 160 9.6 25.0
1,000 2,650 111 12 6 295 16 1 756 15 0 156 11.2 28.6
1,250 3,313 166 12 6 441 11 1 1,137 1 0 157 13.3 34.3
1,500 3,975 221 12 6 587 6 1 1,534 5 0 161 14.8 38.6
1,750 4,638 290 7 6 769 9 10 1,963 19 0 155 16.6 42.3
2,000 5,300 359 2 6 951 13 7 2,409 5 0 153 17.9 45.5
2,250 5,963 443 10 0 1,175 5 6 2,873 7 0 144 19.7 48.2
2,500 6,625 527 17 6 1,398 17 4 3,368 0 0 141 21.1 50.8
5,000 13,250 1,552 17 6 4,115 2 4 8,824 5 0 114 31.1 66.6

SINGLE MAN
1938–39 Net income required in 1956–57 to give the same purchasing power as in 1938–39 Actual net income if gross income in 1956–57 three times 1938–39 Actual net income in 1956–57 if income twice 1938–39
Gross income Net income after tax
£ £ s. d. £ £ £
100 100 0 0 265 285 —
150 148 6 8 393 408 —
200 195 0 0 517 518 —
250 241 13 4 640 622 —
300 287 7 6 762 722 —
400 365 7 6 968 923 —
1,000 833 7 6 2,208 1,923 1,458
1,500 1,223 7 6 3,242 1,998 1,923
2,000 1,585 17 6 4,203 2,973 2,323
2,500 1,917 2 6 5,080 3,348 2,673
5,000 3,382 2 6 8,958 4,473 3,873

MARRIED MAN WITH TWO CHILDREN
1938–39 Net income required in 1956–57 to give the same purchasing power as in 1938–39 Actual net income if gross income in 1956–57 three times 1938–39 Actual net income in 1956–57 if income twice 1938–39
Gross income Net income after tax
£ £ s. d. £ £ £
200 200 0 0 530 597 —
250 250 0 0 663 723 —
300 300 0 0 795 841 —
400 398 6 8 1,056 1,050 —
1,000 888 7 6 2,354 2,051 1,586
1,500 1,278 7 6 3,388 2,626 2,051
2,000 1,640 17 6 4,348 3,101 2,451
2,500 1,972 2 6 5,226 3,476 2,801
5,000 3,447 2 6 9,1351 4,601 4,001