HC Deb 24 July 1980 vol 989 cc382-3W
Mr. Ralph Howell

asked the Chancellor of the Exchequer what would be the separate costs and what would be the combined cost of making the following changes (a) introducing a personal tax allowance for either sex at £1,820 which married couples could aggregate against the income of either spouse, and which would replace all existing tax allowances, including the age allowances, (b) altering tax rates to start at 15 per cent. of the first £1,000 of taxable income, increasing by 5 per cent. on each subsequent £1,000, to a maximum rate of 50 per cent. and (c) replacing all existing children's benefits

and allowances by a single scale of age-related child benefits equal in value to the children's supplementary benefit scale rates.

Mr. Peter Rees

The estimated separate costs would be as follows:

  1. (a) of the order of £3¾ billion for a full year at 1980–81 income levels.
  2. (b) of the order of £3½ billion for a full year at 1980–81 income levels.
  3. (c) of the order of £2¼ billion at November 1980 benefit rates.

The combined cost of (a), (b) and (c) would be of the order of £10 billion.

The total is greater than the sum of the separate components because it includes the cost of giving a separate scale of tax rates to wives' earnings. No account has been taken of the cost of allowing wives' personal allowances against their investment income.