HC Deb 17 March 1970 vol 798 cc81-3W
43. Mr. Lomas

asked the Chancellor of the Exchequer what is the estimated benefit in monetary terms to a married man with two children under the age of 11 years and earning £15, £20, £25, £30, £35, respectively, on the basis that income tax was reduced by 6d. and 1s. in the £1, respectively.

Mr. Taverne

On an annual basis, nil, 11s., £5 12s., £10 13s. and £15 14s. for a 6d. reduction in the standard rate, and roughly double these amounts for a reduction of Is.

48. Mr. Kenneth Baker

asked the Chancellor of the Exchequer if he will give an estimate of the cost of changing the standard rate of income tax by 6d. with no change in the reduced rate.

Mr. Diamond

About £180 million.

49. Mr. Kenneth Baker

asked the Chancellor of the Exchequer, if he will give an estimate of the cost of changing the reduced 6s. rate of income tax by 6d., with no change in the standard rate.

Mr. Diamond

About £135 million.

Mr. Bruce-Gardyne

asked the Chancellor of the Exchequer if he will take steps to reintroduce the liability of sick- ness and unemployment benefits to income tax.

Mr. Diamond

No.

Mr. Kenneth Baker

asked the Chancellor of the Exchequer if he will estimate the cost of changing the standard rate of income tax by 6d. with a proportionate change in the reduced rate.

Mr. Diamond

About £280 million.

Mr. Kenneth Baker

asked the Chancellor of the Exchequer (1) if he will give an estimate of the marginal savings ratio out of the income left in the hands of individuals on the basis of reducing by 10 per cent. the rates of surtax;

(2) if he will give an estimate of the marginal savings ratio out of the income left in the hands of individuals on the basis of making a reduction of 6d. in the standard rate of income tax with a proportionate change in the reduced rate;

(3) if he will give an estimate of the marginal savings ratio out of the income left in the hands of individuals on the basis of increasing the single and married allowances by 10 per cent;

(4) if he will give an estimate of the marginal savings ratio out of the income left in the hands of individuals on the basis of abolishing earned income relief and consolidating tax rates at the present earned income rates.

Mr. Taverne

Income tax and surtax changes of the kind postulated will have varying effects on the distribution of disposable income among the various classes of taxpayers and the marginal savings ratio applicable to each change will vary accordingly. I am not prepared to give an estimate which must therefore necessarily be highly uncertain.

Mr. Kenneth Baker

asked the Chancellor of the Exchequer if he will estimate the cost of increasing the single person's personal allowance against income tax by £25 10s. per annum, with an increase of £37 10s. in the married allowance.

Mr. Diamond

About £295 million.

Mr. Kenneth Baker

asked the Chancellor of the Exchequer if he will estimate the cost of putting a ceiling on the combined rate of income tax and surtax of 15s., with no other change in tax rates.

Mr. Diamond

If the top rate of surtax were limited to 6s. 9d. the cost would be about £30 million.

Mr. Kenneth Baker

asked the Chancellor of the Exchequer if he will estimate the cost of putting a ceiling on the combined rate of income tax and surtax of 12s. 6d., with no other changes in tax rates.

Mr. Taverne

if the top rate of surtax were limited to 4s. 3d. the cost would be about £80 million.