HC Deb 28 February 1978 vol 945 cc187-8W
Mr. Pardoe

asked the Chancellor of the Exchequer if he will publish in the Official Report a list of direct and indirect taxes; and what was the percentage share of total tax revenue, including national insurance contributions, held by direct and indirect taxes in each year since 1960.

Mr. Joel Barnett

When examining the balance of taxation, it is customary to define the direct and indirect taxes as follows:

Direct Taxes

Taxes on personal incomes:

  • Income tax
  • Surtax

Taxes on companies:

  • Profits tax
  • Corporation tax
  • Petroleum revenue tax

Capital taxes:

  • Capital gains tax
  • Development land tax
  • Estate duty
  • Capital transfer tax

Employees' national insurance Contributions

Indirect Taxes

Central Government taxes on expenditure:

  • Purchase tax
  • Value added tax
  • Customs and excise duties
  • Vehicle excise duty
  • Stamp duties
  • Selective employment tax
  • National insurance surcharge

Local authority rates

Employers' national insurance contributions

Using these definitions, the following table shows the percentage share of total tax revenue accounted for by direct and indirect taxes in each year since 1959–60:

Direct taxes percentage of total Indirect taxes percentage of total
1959–60 48.8 51.2
1960–61 49.2 50.8
1961–62 50.3 49.7
1962–63 49.9 50.1
1963–64 48.6 51.4
1964–65 48.2 51.8
1965–66 49.0 51.0
1966–67 47.6 52.4
1967–68 49.0 51.0
1968–69 47.8 52.2
1969–70 49.0 51.0
1970–71 51.2 48.8
1971–72 51.7 48.3
1972–73 49.2 50.8
1973–74 51.3 48.7
1974–75 53.2 46.8
1975–76 52.4 47.6
1976–77 52.2 47.8
Estimated 1977–78 (after Finance Act) 49.4 50.6
Estimated 1977–78 (after October measures)* 48.6 51.4
* The October measures anticipated the requirement, under the Finance Act 1977, that the main personal allowances for 1978–79 should be increased in line with the retail price index. They have thus broadly offset fiscal drag in 1978–79. In making comparisons between the years, therefore, the relevant figure for 1977–78 is the post-Finance Act figure rather than that following the October measures.