§ Mr. Meacherasked the Chancellor of the Exchequer what has been the gain or loss to those with incomes (a) under £5,000, (b) £5,000–£10,000, (c) £10,000–£15,000, (d) £15,000–£20,000, (e) £20,000–£30,000, (f) £30,000–£50,000 and (g) over £50,000 a year as a result of each Finance Act since 1979, both in aggregate and per person on average in each of these categories, in each case indicating how much is due to indexation and how much is real gain.
§ Mr. Alexanderasked the Chancellor of the Exchequer (1) what was the value of income tax concessions to those earnings £30,000 per annum and more for each year since 1979;
(2) what was the number of people taken out of tax for each year since 1979 and the cost to the Exchequer in revenue forgone.
Range of total income in 1985–86* Number of units paying tax in 1985–86 (million) Reductions (+)/Increases (-) in income tax compared with 1978–79 indexed regime £ 1979–80 £ million 1980–81 £ million 1981–82 £ million 1982–83 £ million 1983–84 £ million 1984–85 £ million 1985–86 £ million Under 5,000 4.2 310 130 -340 -280 -20 140 270 5,000 to 10,000 8.1 1,310 820 -170 -60 500 900 1,210 10,000 to 15,000 4.6 1,260 900 210 290 680 1,050 1,290 15,000 to 20,000 1.8 760 580 250 290 480 680 790 20,000 to 30,000 1.0 830 690 280 330 560 760 830 30,000 to 50,000 0.3 740 650 390 420 570 750 770 Over 50,000 0.09 940 900 780 790 860 1,030 1,040 TOTAL 20.1 6,150 4,670 1,400 1,780 3,630 5,310 6,200 Over 30,000 0.4 1,680 1,550 1,170 1,210 1,430 1,780 1,810
Range of total income in 1985–86* Average per tax unit 1979–80 1980–81 1981–82 1982–83 1983–84 1984–85 1985–86 £ £ £ £ £ £ £ £ Under 5,000† 60 30 -70 -60 0 30 50 5,000 to 10,000† 160 100 -20 -10 60 110 150 10,000 to 15,000 270 190 50 60 150 230 280 15,000 to 20,000 420 320 140 160 260 370 430 20,000 to 30,000 810 680 270 320 550 750 810 30,000 to 50,000 2,180 1,910 1,150 1,240 1,680 2,210 2,260 Over 50,000 10,440 10,000 8,670 8,780 9,560 11,440 11,560 TOTAL 290 220 70 80 170 250 290 Over 30,000 3,910 3,600 2,720 2,810 3,330 4,140 4,210
Reductions(+)/Increase(-) in numbers of taxpayers† liable to tax compared with 1978–79 indexed regime 1979–80 (thousands) 1980–81 (thousands) 1981–82 (thousands) 1982–83 (thousands) 1983–84 (thousands) 1984–85 (thousands) 1985–86 (thousands) 920 1,000 -340 -200 540 1,000 1,400 * All information is in terms of tax units—that is, married couples are counted as one and their incomes combined.
† By reference to the estimated numbers who would be liable to pay tax under the indexed 1978–79 regime; this number is some 900,000 greater than the numbers paying tax in 1985–86, 800,000 in the range of income below £5,000 and 100,000 in the range £5,000 to £10,000.
‡ Counting earning wives separately from their husbands.
506W
§ Mr. Moore[pursuant to his reply, 15 January 1986, c. 593–94]: The information is in the tables. For each financial year shown, the tables compare the yield from the tax regime in that year with the 1978–79 tax regime. All estimates are calculated on the 1985–86 tax base and all tax regimes have been indexed to 1985–86 levels by reference to the statutory formula. The comparisons therefore allow for budgetary changes in income tax rates and allowances, but not for any changes since 1978–79 in the definition of the income tax base.
The first table shows the total reduction (+) or increase (-) in tax yield from each income range; and the second table shows the average change for individual tax units. The third table shows the change in numbers of individuals liable to tax.
As child tax allowances were being phased out in 1978–79 they have been excluded from the comparison.
It is not possible to provide useful estimates of the liabilities in 1985–86 for the 1978–79 regime without indexation since Inland Revenue records do not cover many of the people who would be brought into tax by such low levels of personal allowances. A partial analysis with incomplete coverage would be misleading.