§ Sir Brandon Rhys Williamsasked the Chancellor of the Exchequer what is his latest estimate of the extra revenues accruing if all income tax relief were restricted to the standard rate of tax.
§ Mr. Norman LamontThe cost at 1986–87 levels of income of allowing personal tax allowances at rates in excess of the basic rate of income tax is estimated to be about £600 million. Information on the similar cost of other income tax reliefs is available only in respect of mortgage interest, retirement annuity premiums, employees' superannuation contributions, the business expansion scheme, and donations to charities; in total it is also about £600 million. It is not possible to estimate precisely the combined yield from restricting these reliefs and the personal allowances to the basic rate, but it is thought to be about £1,400 million. These estimates make no allowance for any possible behavioural effects if allowances and reliefs were to be restricted to the basic rate.