HC Deb 14 February 1985 vol 73 cc288-9W
Mr. Ralph Howell

asked the Chancellor of the Exchequer if he will publish figures showing revenue obtained from income tax in each year since 1978–79, at current and at constant 1978–79 prices.

Mr. Moore

The information is shown below.

£ million
Income tax receipts At current prices At 1978–79 prices*
1978–79 18,748 18,748
1979–80 20,599 17,620
1980–81 24,295 17,520
1981–82 28,725 18,840
1982–83 30,474 18,740
1983–84 31,280 18,420
* Using the GDP deflator.

Mr. Campbell-Savours

asked the Chancellor of the Exchequer what is his estimate of the cumulative effect on revenue accruing to the Exchequer of changes in (a) income tax, (b) investment income surcharge, (c) capital transfer tax, (d) capital gains tax and (e) income tax above the basic rate introduced since June 1979.

Mr. Moore

[pursuant to his reply, 7 February 1985, c. 673]: Estimates are shown in the table, taking the base for each of the taxes in 1984–85 as given.

The estimates for income tax are based on the difference in liability in a full year at 1984–85 income levels if 1978–79 allowances, rates and thresholds (after indexation to 1984–85 levels by reference to the statutory formula) were substituted for those currently in force.

Similarly, the figure for capital transfer tax represents the estimated effect on the tax payable on transfers in 1984–85 if the 1978–79 structure of the tax were substituted, with statutory indexation of the rate bands after 1982–83.

The figure for capital gains tax also represents the estimated effect on the tax payable on capital gains realised by individuals and trusts in 1984–85 of substituting the 1978–79 tax regime, but excluding the effect of statutory indexation of the threshold after 1982–83. It includes the effect of the indexation of costs of acquisition. These effects cannot be estimated precisely and are subject to a wide margin of error.

It is not possible to determine what income in 1984–85 would have been if the 1978–79 allowances, rates and thresholds had been in force (after indexation) over all the intervening years, or to what extent the changes in the taxes may have affected the levels of transfers or disposals of capital.

Direct Revenue Effects
£ million
Total income tax 4,300
of which: Investment Income Surcharge (IIS) 730
Rates and thresholds above the basic rate (excluding (IIS) 1,120
Capital transfer tax 350
Capital gains tax 300