Family Taxation (Hansard, 31 July 1981)

§ Sir Brandon Rhys Williams
asked the Chancellor of the Exchequer if he will publish a table similar to the reply to the hon. Member for Kensington on 15 July 1981 comparing tax allowances with supplementary benefit entitlement levels for 1981 under the existing system and under the main options proposed in Cmnd. 8093—"The Taxation of Husband and Wife"—but including figures for two-earner married couples; and if he will include a further column showing tax threshold or tax-free incomes a s percentages of supplementary benefit entitlement level under the existing system.

§ Mr. Peter Rees
[pursuant to his reply, 28 July 1981]: The additional information is included in the following table. A married couple's supplementary benefit entitlement level does not depend on the employment status of the partners, although any payments made do, of course, depend on earnings; and if both partners are in full-time employment they will not be entitled to supplementary benefit.
695W

Comparison of tax allowances with Supplementary Benefit Entitlement for 1981–82

Tax thresholds as a percentage of appropriate supplementary benefit entitlement levels with:

Supplementary benefit entitlement levels 1981–82 Present System Non-transferable allowances (Scheme 1) Fully transferable allowances (Scheme 2) Partially transferable allowances (Scheme 3) Non-transferable allowances and increased child benefit (Scheme 4)

£

Single person 1,144.65 120 145 120 127 113

Married couple:

One spouse only with income 1,859.05 115 89 147 122 69

Both spouses with earnings 1,859£05 189 178 147 156 139

Comparison including child support^*

Single person with one child† 1,535.65 167 195 166 175 128

Married couple:

One spouse only with income:

With two children‡ 2,641.05 101 82 123 105 88

With four children^** 3,930.85 81 68 96 84 86

Both spouses with earnings:

With two children‡ 2,641.05 153 145 123 129 137

With four children^** 3,930.85 116 110 96 100 119

Notes to table:

^* Child additions are included with basic supplementary benefit entitlement levels, and child benefit is added to tax allowances.

† Aged under 11. In calculating tax thresholds it is assumed that under Schemes 1 to 3 the support given to a lone parent family would bear the same relativity to the single person's allowance as the additional personal allowance (APA) does at present. Under Scheme 4 the increase in child benefit is taken to compensate single parents for the withdrawal of the APA. The extra child benefit for single parents is included under all four schemes.

‡ Both under 11.

^**Two under 11, two 11–15.

§ Sir Brandon Rhys Williams
asked the Chancellor of the Exchequer if he will publish a table similar to the reply to the hon. Member for Kensington 15 July 1981, and for the same family types, distinguishing where appropriate between the tax allowance and the child benefit component and including two-earner married couples, showing the weekly value in £ sterling of (a) current supplementary benefit scale rate, (b) current tax thresholds or tax-free

Current Weekly Rates of Tax Allowances and Supplementary Benefit Entitlement Levels

Tax allowances, £ per week, with:

Supplementary benefit entitlement levels Present system Non-transferable allowances Fully transferable allowances Partially transferable allowances Non-transferable allowances and increased child benefit

(Scheme 1) (Scheme 2) (Scheme 3) (Scheme 4)

Single person 21.30 26.44 31.83 26.35 27.88 24.81

Married couple:

One spouse only with income 34.60 41.25 31.83 52.69 43.46 24.81

Both Spouses with earnings 34.60 67.69 63.65 52.69 55.77 49.62

Comparison including child support^*

Single person with one child† 28.60 49.00 57.46 48.90 51.21 37.46

Married couple

One spouse only with income:

With two children‡ 49.20 50.75 41.33 62.19 52.96 44.11

With four children^** 71.00 60.25 50.83 71.69 62.46 63.41

Both Spouses with Earnings:

With Two children‡ 49.20 77.19 73.15 62.19 65.27 68.92

With four children^** 71.00 86.69 82.65 71.69 74.77 88.22

Notes:

^* Child additions are included with basic supplementary benefit entitlement levels, and child benefit is added to tax allowances.

† Age under 11. In calculating tax thresholds it is assumed that under Schemes 1 to 3 the support given to a lone parent family would bear the same relatively to the single person's allowance as the additional personal allowances (APA) does at present. Under Scheme 4 the increase in child benefit is taken to compensate single parents for the withdrawal of the APA. The extra child benefit for single parents is included under all four schemes.

‡ Both under 11.

^** Two under 11, two 11–15.

696W
incomes, and (c) tax thresholds or tax-free incomes under schemes 1 to 4 put forward in Cmnd. 8093, "The Taxation of Husband and Wife".

§ Mr. Peter Rees
[pursuant to his reply, 28 July 1981]: The information is as follows. The weekly rates of supplementary benefit and child benefit are those currently in force, and therefore do not correspond to the annual equivalents for 1981–82 given in the previous answer which take account of the proposed increase in November 1981.

Comparison of tax allowances with Supplementary Benefit Entitlement for 1981–82
		Tax thresholds as a percentage of appropriate supplementary benefit entitlement levels with:
	Supplementary benefit entitlement levels 1981–82	Present System	Non-transferable allowances (Scheme 1)	Fully transferable allowances (Scheme 2)	Partially transferable allowances (Scheme 3)	Non-transferable allowances and increased child benefit (Scheme 4)
	£
Single person	1,144.65	120	145	120	127	113
Married couple:
One spouse only with income	1,859.05	115	89	147	122	69
Both spouses with earnings	1,859£05	189	178	147	156	139
		Comparison including child support^*
Single person with one child†	1,535.65	167	195	166	175	128
Married couple:
One spouse only with income:
With two children‡	2,641.05	101	82	123	105	88
With four children^**	3,930.85	81	68	96	84	86
Both spouses with earnings:
With two children‡	2,641.05	153	145	123	129	137
With four children^**	3,930.85	116	110	96	100	119
Notes to table:
^* Child additions are included with basic supplementary benefit entitlement levels, and child benefit is added to tax allowances.
† Aged under 11. In calculating tax thresholds it is assumed that under Schemes 1 to 3 the support given to a lone parent family would bear the same relativity to the single person's allowance as the additional personal allowance (APA) does at present. Under Scheme 4 the increase in child benefit is taken to compensate single parents for the withdrawal of the APA. The extra child benefit for single parents is included under all four schemes.
‡ Both under 11.
^**Two under 11, two 11–15.

Current Weekly Rates of Tax Allowances and Supplementary Benefit Entitlement Levels
	Tax allowances, £ per week, with:
	Supplementary benefit entitlement levels	Present system	Non-transferable allowances	Fully transferable allowances	Partially transferable allowances	Non-transferable allowances and increased child benefit
			(Scheme 1)	(Scheme 2)	(Scheme 3)	(Scheme 4)
Single person	21.30	26.44	31.83	26.35	27.88	24.81
Married couple:
One spouse only with income	34.60	41.25	31.83	52.69	43.46	24.81
Both Spouses with earnings	34.60	67.69	63.65	52.69	55.77	49.62
	Comparison including child support^*
Single person with one child†	28.60	49.00	57.46	48.90	51.21	37.46
Married couple
One spouse only with income:
With two children‡	49.20	50.75	41.33	62.19	52.96	44.11
With four children^**	71.00	60.25	50.83	71.69	62.46	63.41
Both Spouses with Earnings:
With Two children‡	49.20	77.19	73.15	62.19	65.27	68.92
With four children^**	71.00	86.69	82.65	71.69	74.77	88.22
Notes:
^* Child additions are included with basic supplementary benefit entitlement levels, and child benefit is added to tax allowances.
† Age under 11. In calculating tax thresholds it is assumed that under Schemes 1 to 3 the support given to a lone parent family would bear the same relatively to the single person's allowance as the additional personal allowances (APA) does at present. Under Scheme 4 the increase in child benefit is taken to compensate single parents for the withdrawal of the APA. The extra child benefit for single parents is included under all four schemes.
‡ Both under 11.
^** Two under 11, two 11–15.