HC Deb 28 January 1980 vol 977 cc510-1W
Sir Brandon Rhys Williams

asked the Chancellor of the Exchequer if he will publish figures tabulating (a) the costs in the current financial year of each of single person's tax allowance, married person's tax allowance, wife's earned income allowance and child benefits and (b) the additional net costs if each of these were increased by 20 per cent. from April 1980, after taking into account the savings on national insurance child additions, children's supplementary benefit and other means-tested benefits.

Mr. Peter Rees

[pursuant to his reply,22 January 1980, c. 195]: The cost of the income tax allowance for a full tax year at 1979–80 income levels is as follows:

The cost of the allowance for 1980–81 will depend on income levels and rates of tax for that year.

The gross cost of child benefit in the current financial year is £2,920 million, and the additional net cost of a 20 per cent. increase in April would be £475 million for the next financial year.

Sir Brandon Rhys Williams

asked the Chancellor of the Exchequer what would be the net tax expenditure saving in the current financial year if the present single, married and wife's earned income tax allowances were replaced by a uniform adult tax allowance of (a) £700, (b) £900 and (c) £1,000, which married couples could aggregate against the incomes of either spouse, plus a householder's tax allowance of £500, which could be claimed by all ratepayers.

Mr. Peter Rees

[pursuant to his reply, 22 January 1980, c. 195]: The estimated yield for a full year at 1979–80 income levels of a uniform adult tax allowance replacing the present single, wife's earned income and married personal allowances is estimated as follows:

Uniform tax allowance Yield
£ £ million
700 5,200
900 3,100
1,000 2,075

New allowance Increase Reduction in tax charged
at 25% at 30%
£ £ £ £
Single 1,366 201 50.25 60.30
Married 2,128 313 78.25 93.90
Age allowance (Lower) 1,806 266 66.25 79.80
Age allowance (Higher) 2,879 424 105.75 127.20

The December retail prices indices used relate to prices about the middle of November in each case. The amount of the increase between the January 1979 and January 1980 indices will not be known until the January 1980 RPI is available. The allowances shown do not incorporate any rounding that would be needed for the operation of the PAYE scheme.