§ Mr. Ovendenasked the Chancellor of the Exchequer what is the reduction in the rate of tax being paid by building societies during the current year compared with last year; what sum of money is involved in this reduction; and what percentage of the societies' 1977–78 tax bill this represents.
§ Mr. Denzil DaviesThe building society composite rate of tax for 1978–79 is 22.5 per cent., a reduction of 17.5 per cent. from the 1977–78 rate of 24.25 per cent.
The amount involved in this reduction is about £65 million, spread over 1978–79 and 1979–80 assessments, and represents about 9.5 per cent. of the estimated amount of income tax paid by building societies in their 1977–78 assessments on behalf of their investors. It reflects the 713W introduction of the lower rate of income tax as well as the reduction in the basic rate.