§ Mr. Gordon BrownTo ask the Chancellor of the Exchequer how many earners did not directly benefit from the cut in the standard rate of income tax in 1987–88; and how many earners would not benefit from a further cut in the standard rate to 25 per cent. in 1988–89, assuming indexation of personal allowances.
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§ Mr. Norman Lamont[holding answer 26 January 1988]: It is estimated that in 1987–88 and 1988–89 between 3 and 3.5 million earners (including part-time workers) would have insufficient income to benefit from reductions in the basic rate.
§ Mr. Gordon BrownTo ask the Chancellor of the Exchequer what would be the cost of reintroducing a reduced rate band of income tax, worth the same as that band in 1978–79 in real terms, in 1988–89.
§ Mr. Norman Lamont[holding answer 26 January 1988]: The full-year direct revenue cost of reintroducing a reduced rate band of income tax in 1988–89, charging the first £1,650 of taxable income at 19 per cent. and worth the same to taxpayers in real terms as the band in 1978–89, would be about £3 billion. The cost assumes indexation of the current income tax bands and allowances according to the statutory formula.