§ Mr. DarlingTo ask the Chancellor of the Exchequer what was the estimated income tax forgone in 1986–87 by the Treasury from taxpayers earnings(a) between £20,000 and £50,000 and (b) more than £50,000 as a result of employee contributions to approved pension schemes.
§ Mr. Norman Lamont[holding answer 4 February 1988]: I regret the delay in replying to this question.
The latest estimate of the cost of tax relief in respect of employees' contributions to approved pension schemes in 1986–87 is £1.6 billion. I regret that it is not possible to provide an analysis of this amount by range of earnings.
§ Mr. DarlingTo ask the Chancellor of the Exchequer what was the estimated income tax forgone in 1986–87 by the Treasury from taxpayers earnings(a) between £20,000 and £50,000 and (b) more than £50,000 as a result of employer contributions to approved pension schemes.
§ Mr. Norman Lamont[holding answer 4 February 1988]: I regret the delay in replying to this question.
The latest estimate of the cost of tax relief in respect of employers' contributions to approved pension schemes in 1986–87 is £3 billion. I regret that it is not possible to provide an analysis of this amount by range of earnings.
§ Mr. Nigel GriffithsTo ask the Chancellor of the Exchequer what economic and econometric evidence he has which indicates(a) the effects of cutting the higher rates of income tax on the work effort and efficiency of those high paid workers affected by the cuts and, (b) the effects of cutting the standard rate of income tax the effects on the national work effort.
§ Mr. Norman Lamont[holding answer 19 February 1988]: Cutting marginal tax rates undoubtedly gives a stimulus to enterprise, initiative and effort. The effect inevitably takes some time to build up. Econometric studies identify a positive incentive effect, though they tend to look only at short term effects. I know of no recent United Kingdom studies specifically on the effect of reducing higher rates of income tax.