§ Mr. Meacherasked the Chancellor of the Exchequer what would be the net overall loss to the Exchequer from substituting a universal flat rate of £500 earned income allowance for the present proportionate allowances, and what would be the differential effect of the new proposal as against the present arrangement for a married man with two children earning, respectively, £500, £1,000, £2,000, £5,000, £10,000 and £20,000 per year.
§ Mr. Patrick JenkinThe cost would be about £1000 million. The effects in the examples specified would be as follows:
Married man, with two children under 11. (Reduction in tax — Increase in tax +).
Earnings £pa. £p 500 … … (already not liable) 1,000 … … -62.46 2,000 … … -17.50 5,000 … … +195.98 10,000 … … +748.12 20,000 … … +931.87 NOTE:
The change in tax has been calculated using present income tax allowances but with a standard rate of 38.75 per cent. at present surtax rates.
§ Mr. Meacherasked the Chancellor of the Exchequer if the present two-ninths 176W and one-ninth earned income allowance were withdrawn, what level of flat-rate earned income allowance would this permit for the current workforce.
§ Mr. Patrick JenkinSomething in the region of £350.