§ Mr. Knoxasked the Chancellor of the Exchequer how the maximum and minimum rates of direct taxation of incomes in the United Kingdom compare with those applying in each of the European Economic Community countries.
§ Mr. Peter ReesThe information requested is given in the table below:
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Minimum rates of income tax % Maximum rates of income tax % Belgium 19.2 72.0 Denmark 14.6 40.0 France 7.2 60.0
Minimum rates of income tax %
Maximum rates of income tax %
Germany 18.0 56.0 Greece 2.0 63.0 Ireland 25.0 60.0 Italy 10.0 72.0 Luxembourg 12.3 58.4 Netherlands 16.3 72.0 United Kingdom 30.0 60.0 Notes:
The rates shown are those for 1981—1981–82—except for Belgium, France and Greece—1980. All figures relate to national or federal tax only. In France the proposed surcharge on high income tax liabilities will increase the maximum rate for 1980 to 75 per cent.
Figures in the table are for employment income only. The minimum rates of income tax on investment income in Belgium, France, Germany, Greece and the Netherlands are 24 per cent., 10 per cent., 22 per cent., 3.3 per cent. and 17 per cent. respectively. The maximum rate of income tax on investment income in the United Kingdom is 75 per cent. In other cases the minimum and maximum rates on investment income are the same as those for employment income.
In all cases the minimum rates are the lowest at which tax is actually payable. The maximum rates of income tax shown are the highest actually charged. The rates shown may differ from the nominal rates of tax in the countries concerned because they take account of any employment income and other reliefs, minimum expenses deductions and minimum tax liabilities.
All figures relate to a married man with two dependent children.
Local income taxes can sometimes make a significant difference. In Denmark, for example, the Copenhagen rate of tax raises the starting rate to 40.8 per cent. and the maximum rate to 65.5 per cent.