§ Mr. Fieldasked the Chancellor of the Exchequer how many taxpayers are subject to each of the following marginal rates of income tax on earned income, namely, 25 per cent., 30 per cent., 40 per cent., 45 per cent., 50 per cent., 55 per cent. and 60 per cent., respectively.
§ Mr. Peter ReesCounting married couples as one, the estimates at 1979–80 income levels are as follows:
Marginal Rate of Tax on Earned Income Estimated No. of Tax Units per cent. (thousands) 25 2,470 30 17,480 40 215 45 110 50 70 55 25 60 30 Total 20,400 Since income tax is levied on income regardless of source, there are difficulties in allocating tax liabilities to earned or investment income. The answer relates to the top rate on earned income, treating any investment income as the top slice of total income.
For a married couple, where one partner pays tax on earnings at a higher rate than the other, the higher of the two rates is taken to be the marginal rate.