§ Mr. Ralph Howellasked the Chancellor of the Exchequer if he will publish a table showing, for each member State of the EEC, (a) the maximum rate of personal direct taxation on earned income, (b) the level of earnings at which this rate comes into force for a single person and for a married couple with two children under 11 years of age, and (c) the proportion of total revenue accounted for by personal direct taxation.
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§ Mr. Robert SheldonThe following is the information requested :
A. The maximum marginal rates of national tax on income from employment are as follows:
Belgium 72 per cent, (a) Denmark 39.6 per cent. France 48.6 per cent. Germany 56 per cent. Ireland 80 per cent, (b) Italy 82 per cent. Luxembourg 57 per cent. Netherlands 71 per cent. United Kingdom 83 per cent. (a) 60 per cent. plus two 10 per cent. surcharges. The maximum effective (average) rate is 50 per cent. excluding the two surcharges.
(b) A reduction to 70 per cent. is proposed in the 1975 Finance Bill in view of the introduction of a wealth tax.
Notes
1. Local income taxes and social security contributions are not included in the rates shown.
2. In some of the countries concerned, the rates applying to earned income from self-employment differ from those shown above.
B. The levels of earnings at which the above rates come into force are as follows:
Single Person Married Man with 2 children under 11 £ £ Belgium 49,200 49,000 Denmark 7,020 7,020 France 14,200 41,400 Germany 23,700 47,100 Ireland 8,850 (b) 9,550 (c) Italy 327,900 327,900 Luxembourg 8,700 17,130 Netherlands 25,800 26,530 United Kingdom 20,626 21,346(a) (a) Assumes that the family allowance is relinquished.
(b) This will be raised to £10,925 under the 1975 Finance Bill proposals.
(c) This will be raised to £11,730 under the 1975 Finance Bill proposals.
C. The latest available figures for the proportion of total revenue accounted for by personal direct taxation relate to 1972 and are as follows:
Belgium 27.4 per cent. Denmark 48.0 per cent. France 11.1 per cent. Germany 28.1 per cent. Ireland 22.8 per cent. Italy 12.7 per cent. Luxembourg 26.6 per cent. Netherlands 27.9 per cent. United Kingdom 32.1 per cent. SourceRevenue Statistics of OECD Member Countries 1965–72, Table 13.
NoteIn this table, personal direct taxation includes both national and local taxes on earned and investment income and on capital gains; it is shown as a percentage of total central and local government revenue from taxation and social security contributions.