HC Deb 18 January 1982 vol 16 cc86-7W
Mr. Grylls

asked the Chancellor of the Exchequer how many new trades, professions and vocations assessed under schedule D cases I and II were assessed on the special basis at commencement under section 116 of the Income and Corporation Taxes Act 1970 in the financial years 1975–76, 1976–77, 1977–78, 1978–79 and 1979–80, respectively.

Mr. Ridley

Information in the precise form requested is not available. However, it is estimated that, in 1978–79 some 90, 000 businesses were established which would have been assessed for that year on the special basis provided for by section 116 ICTA 1970.

The equivalent number for 1979–80 is estimated to be about 110, 000.

Information on which to base estimates for earlier years is not available.

Mr. Grylls

asked the Chancellor of the Exchequer what proportion of the trades, professions and vocations assessed under schedule D cases I and II on the special basis at commencement in 1975–76 were assessed to income tax under schedule D cases I and II: (a) in total and (b) on a taxable income exceeding £5, 000 in each of the subsequent years.

Mr. Ridley

I regret that the information requested is not available.

Mr. Grylls

asked the Chancellor of the Exchequer what would be the future annual loss of revenue occasioned by relieving from income tax (a) for the first three years of assessment and (b) for the first five years of assessment the first £5, 000 of taxable income from new trades, professions or vocations to which the special commencement provisions applied.

Mr. Ridley

From information currently available, it is estimated that if, for the first three years of assessment, up to £5, 000 of the net amount otherwise chargeable to income tax under cases I and II of schedule D was relieved from tax, the cost would ultimately build up to about £100 million per annum assuming that profits continue at their present level. However, new businesses would have an incentive to commence trading as a result of a relief of this kind and this estimate does not allow for any change in revenue which would ensue.

Information on which to base an estimate of the cost of a similar relief extending over the first five years of a business is not available.