HC Deb 13 March 1986 vol 93 cc576-83W
17. Mr. Neil Hamilton

asked the Chancellor of the Exchequer if he will make a statement on the yield of all taxation from those earning £30,000 or more in 1985–86.

Mr. Moore

The total income tax yield in 1985–86 from individuals with taxable income above £30,000 is £4½ billion, of which nearly £2 billion is paid on taxable income in excess of £30,000. It is not possible to estimate the yield of other taxes from this group.

33. Mr. Greenway

asked the Chancellor of the Exchequer what changes there have been in the number of people paying income tax since 1979; how this compares with the previous five year period; and if he will make a statement.

Mr. Moore

The estimated numbers of individual taxpayers (including earning wives) since 1973–74 are as follows:

(thousands)
Individual taxpayers
1973–74 23,100
1974–75 24,300
1975–76 25,300
1976–77 25,900
1977–78 24,800
1978–79 25,900
1979–80 25,900
1980–81 25,200
1981–82 24,800
1982–83 24,600

Earnings after income tax*, national insurance contributions and child benefit
Single Married couple (two earners)‡ no children Married couple (one earner) two children║
Earnings† At current prices £ At constant (1978–79) prices £ As per cent. of gross income Per cent. At current prices £ At constant (1978–79) prices £ As per cent. of gross income Per cent. At current prices £ At constant (1978–79) prices £ As per cent. of gross income Per cent.
50 per cent. average earnings
1978–79 35.48 35.48 76.5 63.98 63.98 84.2 45.26 45.26 97.5
1979–80 42.15 36.39 77.1 75.57 65.25 84.2 53.90 46.54 98.6
1980–81 49.49 36.73 75.3 89.03 66.08 81.9 62.48 46.38 95.1
1981–82 53.34 35.51 73.1 95.51 63.59 79.1 67.65 45.04 92.7
1982–83 57.23 35.59 72.7 102.94 64.01 79.0 73.25 45.55 93.1
1983–84 62.45 37.09 73.0 113.04 67.14 79.6 80.46 47.79 94.1
1984–85 67.99 38.45 73.5 123.22 69.68 80.4 87.88 49.70 95.0
1985–86 73.66 39.30 73.7 134.89 71.96 81.5 94.68 50.51 94.8
1986–87¶ 78.68 40.55 73.6 143.96 74.20 81.3 100.50 51.80 94.0
75 per cent. average earnings
1978–79 49.51 49.51 71.1 87.27 87.27 76.6 59.41 59.41 85.4
1979–80 59.50 51.37 72.6 104.17 89.94 77.3 71.25 61.52 86.9
1980–81 70.27 52.16 71.3 123.39 91.59 75.7 83.26 61.80 84.5
1981–82 76.05 50.63 69.5 133.10 88.62 73.5 90.36 60.16 82.6
1982–83 81.33 50.57 68.9 142.85 88.83 73.1 97.35 60.54 82.5
1983–84 88.53 52.59 69.0 156.35 92.87 73.4 106.53 63.28 83.1
1984–85 96.20 54.40 69.3 169.95 96.11 74.0 116.10 65.65 83.7
1985–86 104.13 55.55 69.5 184.04 98.18 74.2 125.15 66.76 83.5
1986–87¶ 111.28 57.36 69.4 196.56 101.31 74.0 133.10 68.60 83.0
100 per cent. average earnings
1978–79 63.55 63.55 68.5 110.26 110.26 72.5 73.45 73.45 79.1
1979–80 76.85 66.35 70.3 132.68 114.55 73.9 88.60 76.50 81.1
1980–81 91.04 67.58 69.3 157.75 117.09 72.6 104.03 77.22 79.2
1981–82 98.76 65.75 67.7 170.70 113.65 70.7 113.06 75.27 77.5
1982–83 105.44 65.57 67.0 182.75 113.64 70.1 121.45 75.52 77.2
1983–84 114.61 68.08 67.0 199.66 118.60 70.3 132.61 78.77 77.5
1984–85 124.42 70.36 67.3 216.67 122.53 70.7 144.31 81.61 78.0
1985–86 134.60 71.81 67.4 234.50 125.10 70.9 155.62 83.02 77.9
1986–87¶ 143.89 74.17 67.3 250.56 129.15 70.8 165.70 85.41 77.5
150 per cent. average earnings
1978–79 92.87 92.87 66.7 155.37 155.37 68.1 102.77 102.77 73.8
1979–80 113.43 97.93 69.2 189.61 163.71 70.4 125.18 108.08 76.4
1980–81 134.77 100.04 68.4 224.27 166.47 68.8 147.76 109.68 75.0
1981–82 145.63 96.96 66.5 242.92 161.73 67.0 159.94 106.49 73.1
1982–83 155.05 96.42 65.7 258.89 160.99 66.2 171.06 106.37 72.5
1983–84 168.70 100.21 65.8 282.39 167.74 66.3 186.70 110.90 72.8
1984–85 183.32 103.67 66.1 305.97 173.03 66.6 203.21 114.91 73.2

(thousands)
Individual taxpayers
*1983–84 24,300
*1984–85 24,050
*1985–86 24,000

* Provisional,

Mr. Wrigglesworth

asked the Chancellor of the Exchequer what is his estimate of the effects of changes in personal taxation on disposable incomes for each year since 1978–79 for single people, married couples (both working, without children) and married couples (husband only working, with two children) on 50 per cent., 75 per cent., 100 per cent., 150 per cent., 200 per cent. and 500 per cent. of average earnings expressed in current and constant prices and as a percentage of gross earnings; and what is his estimate for 1986–87 on the basis of the conventional assumptions of index-linked allowances and duties.

Mr. Moore

The information is in the following tables.

Single Married couple (two earners)‡ no children Married couple (one earner) two children║
Earnings† At current prices £ At constant (1978–79) prices £ As per cent. of gross income Per cent. At current prices £ At constant (1978–79) prices £ As per cent. of gross income Per cent. At current prices £ At constant (1978–79) prices £ As per cent. of gross income Per cent.
1985–86 198.66 105.98 66.3 331.34 176.76 66.8 219.68 117.19 73.3
1986–87¶ 212.31 109.43 66.2 354.16 182.55 66.7 234.13 120.68 73.0
200 per cent. average earnings
1978–79 123.06 123.06 66.3 202.10 202.10 66.5 133.85 133.85 72.1
1979–80 151.30 130.63 69.2 248.39 214.46 69.2 163.44 141.11 74.8
1980–81 178.75 132.68 68.0 295.81 219.57 68.1 193.23 143.43 73.5
1981–82 191.26 127.34 65.5 318.34 211.95 65.9 207.58 138.20 71.1
1982–83 206.28 128.27 65.5 341.73 212.50 65.6 232.99 144.88 74.0
1983–84 225.86 134.16 66.0 374.02 222.16 65.8 245.80 146.00 71.9
1984–85 244.54 138.29 66.1 404.21 228.58 66.0 266.64 150.78 72.1
1985–86 264.03 140.85 66.1 436.69 232.96 66.0 287.45 153.35 71.9
1986–87¶ 281.95 145.33 65.9 466.59 240.50 65.9 306.30 157.88 71.6
500 per cent. average earnings
1978–79 221.83 221.83 47.8 396.19 396.19 52.1 237.79 237.79 51.2
1979–80 312.45 269.76 57.2 536.54 463.24 59.7 327.95 283.15 60.0
1980–81 366.09 271.74 55.7 633.40 470.15 58.3 383.52 284.67 58.4
1981–82 390.72 260.14 53.6 676.97 450.72 56.0 409.47 272.62 56.1
1982–83 425.72 264.73 54.1 737.02 458.31 56.6 446.82 277.85 56.8
1983–84 469.43 278.84 54.9 813.52 483.22 57.3 493.26 292.99 57.7
1984–85 506.02 286.15 54.7 875.63 495.17 57.2 532.54 301.15 57.6
1985–86 543.98 290.20 54.5 942.16 502.62 56.9 572.21 305.26 57.3
1986–87¶ 580.53 299.23 54.3 1,005.68 518.36 56.8 609.96 314.39 57.1

Notes

*Estimates do not include income-related benefits to which some taxpayers may be entitled.

†Earnings are based on adult rates for those in full time work with pay unaffected by absence.

‡Assuming husband and wife have earnings at the same multiple of the earnings distribution for full time males and full time females respectively.

║Child benefit assumes two children aged under 11.

¶Average earnings are assumed to increase by 7 per cent. between 1985–86 and 1986–87, as in the Autumn Statement, 1985.

Mr. Wrigglesworth

asked the Chancellor of the Exchequer what is his estimate of the effects of changes in personal taxation on disposable incomes for each year since 1978–79 for single people, married couples (both working, without children), and married couples (husband only working, without children), for the lowest decile, lowest quartile, median, upper quartile, median, upper quartile and highest decile of all males and females, expressed in current and constant prices and as a percentage of gross earnings; and what is his estimate for 1986–87 on the basis of the conventional assumptions of index-linked allowances and duties.

Mr. Moore

Information in the following tables is based on estimates of earnings for those in full-time work

Earnings after income tax, National Insurance contributions and Child Benefit
Single Married Couple (two earners)† No Children Married Couple (one earner) 2 Children*
At current prices £ At constant April 85 prices £ As per cent. of gross income Per cent. At current prices £ At constant April 85 prices £ As per cent. of gross income Per cent. At current prices £ At constant April 85 prices £ As per cent. of gross income Per cent.
Lowest Decile of earnings
April 78 39.35 75.61 74.5 73.17 140.59 80.7 48.71 93.59 92.3
April 79 44.09 76.96 73.9 81.77 142.73 79.8 55.90 97.58 93.6
April 80 53.47 76.66 74.3 98.48 141.19 79.7 65.93 94.52 91.6
April 81 57.67 73.79 72.2 105.71 135.27 77.0 71.62 91.65 89.6
April 82 61.95 72.45 71.7 114.03 133.36 76.8 77.53 90.67 89.7
April 83 66.91 75.24 72.1 123.66 139.06 77.6 84.43 94.94 91.0

paid at adult rates, with pay unaffected by absence. Estimates are based on information from the annual new earnings surveys. Latest information is for April 1985.

Income tax rates and allowances for April 1979 are those specified in the Finance Act 1979, later replaced by those announced in June 1979; for other Aprils, they are the rates and allowances for the financial year immediately following. Taxpayers are assumed to have no reliefs or allowances other than the appropriate personal allowance. National insurance contributions are at the contracted-in rate.

The calculations take no account of income-related benefits to which those at the lowest decile and quartile may be entitled. Changes in the purchasing power of net earnings have been calculated by reference to movements in the general index of retail prices between Aprils.

Single Married Couple (two earners)† No Children Married Couple (one earner) 2 Children*
At current prices £ At constant April 85 prices £ As per cent. of gross income Per cent. At current prices £ At constant April 85 prices £ As per cent. of gross income Per cent. At current prices £ At constant April 85 prices £ As per cent. of gross income Per cent.
April 84 71.96 76.94 72.7 133.29 142.51 78.5 91.59 97.93 92.5
April 85 76.83 76.83 73.1 144.46 144.46 79.9 97.74 97.74 93.0
Lower Quartile of earnings
April 78 46.55 89.44 71.9 83.70 160.82 77.4 55.91 107.42 86.4
April 79 52.62 91.85 71.3 94.36 164.71 76.5 64.43 112.47 87.3
April 80 64.10 91.90 72.2 114.17 163.68 76.9 76.55 109.75 86.2
April 81 69.44 88.86 70.3 123.08 157.49 74.5 83.39 106.71 84.4
April 82 74.93 87.63 69.6 133.26 155.85 74.1 90.51 105.85 84.1
April 83 81.00 91.09 69.9 144.58 162.58 74.6 98.52 110.79 85.0
April 84 87.21 93.25 70.3 157.02 167.89 75.3 106.84 114.23 86.2
April 85 93.79 93.79 70.6 168.99 168.99 75.6 114.70 114.70 86.3
Median of earnings
April 78 56.29 108.15 69.7 99.13 190.47 74.2 65.65 126.14 81.2
April 79 63.94 111.61 69.1 115.73 202.01 75.7 75.75 132.23 81.9
April 80 78.52 112.57 70.4 137.00 196.41 74.3 90.97 130.42 81.5
April 81 85.56 109.48 68.6 148.67 190.24 72.1 99.51 127.33 79.8
April 82 93.00 108.77 67.8 161.99 189.45 71.5 108.58 126.99 79.2
April 83 100.64 113.17 68.0 175.81 197.70 71.8 118.17 132.88 79.8
April 84 109.53 117.11 68.2 192.88 206.23 72.1 129.17 138.11 80.4
April 85 118.13 118.13 68.4 208.33 208.33 72.3 139.04 139.04 80.5
Upper Quartile of earnings
April 78 68.75 132.09 67.8 118.91 228.47 71.5 78.11 150.08 77.0
April 79 78.28 136.64 67.4 135.07 235.77 70.9 90.08 157.24 77.5
April 80 97.62 139.95 68.8 167.43 240.04 72.0 110.07 157.80 77.6
April 81 108.72 139.12 67.2 185.64 237.55 69.9 122.67 156.97 75.8
April 82 118.36 138.43 66.3 202.47 236.80 69.1 133.94 156.65 75.0
April 83 127.91 143.84 66.3 219.37 246.68 69.4 145.43 163.54 75.4
April 84 139.42 149.07 66.5 242.08 258.83 69.4 159.06 170.07 75.9
April 85 150.76 150.76 66.6 262.68 262.68 69.7 171.68 171.68 75.9
Highest Decile of earnings
April 78 85.50 164.28 66.7 144.40 277.45 69.3 94.86 182.26 74.0
April 79 96.89 169.13 66.5 161.13 281.26 68.0 108.69 189.73 74.5
April 80 123.64 177.26 68.2 206.57 296.15 70.2 136.09 195.11 75.1
April 81 139.36 178.33 66.4 228.91 292.91 67.1 153.32 196.19 73.0
April 82 151.76 177.49 65.6 249.29 291.55 66.3 167.34 195.71 72.3
April 83 165.83 186.48 65.7 273.97 308.08 66.8 183.36 206.19 72.6
April 84 181.85 194.43 66.0 302.48 323.41 66.8 201.48 215.42 73.2
April 85 196.28 196.28 66.2 324.88 324.88 66.9 217.19 217.19 73.3
* Both children under 11.
† Assuming husband and wife have earnings at the same quantile of the earnings distribution for full-time males and full-time females respectively.

Mr. Pike

asked the Chancellor of the Exchequer if he will estimate the increase in take-home pay for (a) a single person and (b) a married couple from an increase of 10 per cent. in the threshold for the basic rate of income tax.

Mr. Moore

For basic rate taxpayers in 1986–87 the increase would be £1.27 per week for a single person and £2.02 per week for a married couple.

Sir Peter Hordern

asked the Chancellor of the Exchequer (1) what a single person earning £140 a week would pay now, in income tax and national insurance contributions, at current rates, allowances and rate bands; and what such a person would pay at 1978–79 rates, allowances and rate bands;

(2) what a single person earning £8,500 a year would have to pay in income tax (a) at current rates, allowances and rate bands and (b) at rates, allowances and rate bands obtaining in June 1979.

Mr. Moore

I shall let my hon. Friend have a reply as soon as possible.

Mr. Nicholas Winterton

asked the Chancellor of the Exchequer what percentage of average earnings has been represented by personal income tax allowances in each of the last 20 years for which figures are available; and what was the percentage change in such allowances in each of those years on the previous year's figures.

Mr. Moore

[pursuant to his reply, 5 February 1986, c. 185]: The information is given in the table. Tax thresholds are shown as percentages of both average manual earnings and (for 1970–71 onwards) average earnings for all occupations.

Tax thresholds 1966–67 to 1985–86—Single person and married man without children
Single person Married man without children
Threshold at current prices Percentage increase on previous year Threshold as percentage of average manual earnings* Threshold as percentage of average earnings† for all occupations Threshold at current prices Percentage increase on previous year Threshold as percentage of average manual earnings* Threshold as percentage of average earnings† for all occupations
Tax year £ Per cent. Per cent. Per cent. £ Per cent. Per cent. Per cent.
1966–67 283 0.0 26.8 na 437 0.0 41.4 na
1967–68 283 0.0 25.5 na 437 0.0 39.3 na
1968–69 283 0.0 23.7 na 437 0.0 36.5 na
1969–70 328 15.9 25.4 na 482 10.3 37.3 na
1970–71 418 27.4 28.7 26.1 598 24.1 41.0 37.3
1971–72 418 0.0 25.8 23.7 598 0.0 37.0 33.9
1972–73 591 41.4 32.1 29.6 771 28.9 41.8 38.6
1973–74 595 0.7 28.0 26.4 775 0.5 36.5 34.3
1974.75 625 5.0 24.4 22.7 865 11.6 33.7 31.4
1975–76 675 8.0 21.4 19.8 955 10.4 30.3 28.0
1976–77 735 8.9 20.6 19.1 1,085 13.6 30.5 28.2
1977–78 945 28.6 24.4 22.5 1,455 34.1 37.6 34.7
1978–79 985 4.2 22.0 20.4 1,535 5.5 34.3 31.8
1979–80 1,165 18.3 22.2 20.5 1,815 18.2 34.5 31.9
1980–81 1,375 18.0 22.7 20.1 2,145 18.2 35.4 31.4
1981–82 1,375 0.0 20.6 18.1 2,145 0.0 32.1 28.3
1982–83 1,565 13.8 21.8 19.1 2,445 14.0 34.1 29.9
1983–84 1,785 14.1 23.1 20.1 2,795 14.3 36.1 31.4
1984–85 2,005 12.3 24.1 20.8 3,155 12.9 37.9 32.8
1985.86‡ 2,205 10.0 24.6 21.2 3,455 9.5 38.5 33.3
* Full time males aged over 21 working a full week
† Full time males paid at adult rates working a full week
‡ Provisional

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