§ Mr. Shersbyasked the Chancellor of the Exchequer what would be the loss of revenue to the Exchequer if all retirement pensioners were exempted from the payment of income tax; and what would be the estimated increase in the standard rate of income tax for the working population in order to compensate for such loss.
§ Mr. Peter ReesEstimates relating only to those in receipt of retirement pensions are not readily available and could be obtained only at disproportionate cost. The available information relates to all persons aged 65 years and over, from whom the estimated yield of tax on all sources of income is £3 billion, for a full year at 1980–81 income levels.
If these persons were exempted from income tax, the estimated increase in the basic rate to compensate for the loss of revenue would be about 4p.