HC Deb 29 March 1983 vol 40 c128W
Mr. Austin Mitchell

asked the Chancellor of the Exchequer further to his reply dated 1 March, Official Report, c. 97. to the hon. Member for Grimsby, concerning wife's earnings allowance and separate earnings assessment, if he will estimate the net yield from a new earnings allowance of (a) £1,000 and (b) £1,000 or 20 per cent. of wife's earnings, to a maximum allowance of £2,000, whichever is the greater.

Mr. Ridley

The yield of £500 million quoted in the previous reply, which was in respect of an allowance of £1,000 plus 10 per cent. of wife's earnings, was estimated on the basis of statutorily indexed allowances and thresholds for 1983–84. In comparison with the levels proposed by my right hon. Friend in his Budget statement, the yield would be greater. Figures on this basis for all three proposals are as follows:

Effect of abolishing wife's earnings election and changing wife's earned income allowance from £1,785 to: Revenue yield in a full year at 1983–84 income levels
£ million
£1,000 plus 10 per cent. of wife's earnings 650
£1,000 1,250
Greater of £1,000 or 20 per cent. of wife's earnings, up to a maximum of £2,000 1,100

The estimates do not take account of any changes in behaviour that might occur if the proposals were introduced.