INCOME TAX LIABILITIES (Hansard, 30 June 1988)

§ Lord Young of Graffham

The tables show the latest estimates of reductions in income tax liabilities at 1988–89 income levels of the 1988–89 income tax regime compared with an indexed 1980–81 regime. The comparison thus allows for budgetary changes in tax rates, thresholds and allowances but not for any change in the definition of the tax base. The 1980–81 allowances and thresholds have been indexed in line with the increase in the retail prices index between December 1979 and December 1987.

Reductions in Income Tax liabilities in 1988–89 compared with 1980–81 Indexed Tax Regime
Point of income distribution in 1988–89⁽¹⁾	Number of units paying tax in 1988–89⁽²⁾	Reduction in tax	Average reduction in income tax compared with the 1980–81 indexed regime⁽³⁾
	millions	£billion	£per year
Top 1 per cent.	.21	2.4	11,470
Top 2 to 5 per cent.	.84	1.5	1,830
Top 6 to 10 per cent.	1.0	1.2	1,120
Top 11 to 20 per cent.	2.1	1.8	830
Top 21 to 30 per cent.	2.1	1.3	640
Top 31 to 50 per cent.	4.2	2.0	480
Bottom 50 per cent.	10.5	2.6	230
All	20.9	12.8	600
⁽¹⁾ Based on 20,900,000 single people and married couples expected to pay tax in 1988–89 and excluding 510,000 who would pay tax under the revalorised 1980–81 regime.
⁽²⁾ All information is in terms of tax units, i.e. married couples are counted as one and their incomes combined.
⁽³⁾ Based on taxpayers expected to pay tax under a revalorised 1980ߝ81 regime.