§ Mr. Wrigglesworthasked the Chancellor of the Exchequer what proportion of tax units (households) are paying less income tax and national insurance contributions as a proportion of gross earnings in 1985–86 than in 1978–79.
§ Mr. Rookerasked the Chancellor of the Exchequer if, pursuant to his reply to the hon. Member for Birmingham, Perry Barr, 27 March, Official Report, columns 607–10, he will publish a table for each taxpayer group shown there, showing at what multiple of average earnings the percentage of tax plus national insurance is the same for 1986–87 as it was in 1978–79 stating the figure used for average earnings in 1986–87; and how many taxpayers in each group fall above and below this figure.
§ Mr. Moore[pursuant to his replies, 24 February 1986, c. 493, and 16 April 1986, c. 418]: I regret the delay in
Ranges of earnings* where income tax† and NIC‡ form a smaller proportion of gross earnings in 1985–86 and 1986–87 than in 1978–79 under the assumptions in the footnotes below Up to: £ per week Percentage of average earnings Above: £ per week Percentage of average earnings 1985–86 Single 55 28 475 240 Married couple both working,║ no children 139 ¶42 810 ¶245 Married couple, husband only working, no children 55 28 486 243 Married couple, husband only working, two children under 11 89 45 512 260 Married couple, husband only working, two children under 11, one child between 11 and 15, one over 16 83 42 588 294 1986–87 Single 60 28 293 137 Married couple both working,║ no children 140 ¶39 554 ¶156 Married couple, husband only working, no children 60 28 310 145 Married couple, husband only working, two children under 11 77 36 326 152 Married couple, husband only working, two children under 11, one child between 11 and 15, one over 16 85 40 378 177 * At the income levels specified tax plus NIC is the same proportion of earnings in the later year as in 1978–79. The income levels have been rounded to the nearest £1. † Less child benefit, where appropriate. ‡ Assuming post-October 1985 rates of NIC for contracted-in employees for 1985–86. ║ On the assumption that husband and wife each have the same multiple of the appropriate all occupations figure for average earnings (full time males and females respectively). ¶ Percentage of joint income. The second table shows the numbers of single people and married couples whose main source of income is earnings from employment by ranges of earnings corresponding to the break-even points in the first table for single people, one-earner married couples and two-earner married couples (with two children). But many of the taxpayers in the middle ranges will not pay a higher proportion of their income in tax and national insurance since they also receive investment income which is not
330Wreplying to these questions. The first table shows the ranges of earnings within which income tax plus national insurance contributions form a smaller proportion of gross earnings in 1985–86 than in 1978–79, assuming that earnings have risen in line with the national average, and the equivalent comparison for 1986–87. The information is shown for five family types including the four in the question from the hon. Member for Birmingham, Perry Barr. The proportion of tax and national insurance is the same as in 1978–79 at the income levels specified. The values of average earnings used for these comparisons are £92.80, £199–80 and £213.80 per week for 1978–79, 1985–86 and 1986–87, respectively.
In both 1985–86 and 1986–87 at all income levels those whose earnings have risen in line with the national average have seen a real increase in their take home pay since 1978–79.
subject to national insurance contributions. The proportion depends also on other allowances and reliefs which may be available against tax and on whether the individual is contracted-in or contracted-out of the earnings-related part of the national insurance scheme. The comparisons for individual married couples also depend on the number of children and the split of earnings between the spouses. I 331W regret that it is not currently possible to provide a comprehensive analysis comparing income tax and NIC regimes which would allow for all of these factors.
1985–86 1986–87 Range of earnings £ per week Number '000 Range of earnings £ per week Number '000 Single people up to 55 810 up to 60 860 55 to 475 6,250 60 to 293 6,020 over 475 25 over 293 240 Married one-earner up to 89 330 up to 77 200 89 to 512 4,610 77 to 326 4,210 over 512 100 over 326 610 Married two-earner up to 138.65 100 up to 139.75 80 138.65 to 810 3,020 139.75 to 554 2,950 over 810 20 over 554 160 Numbers of single people and married couples liable to income tax whose main source of income is earnings from employment.