§ Mrs. Margaret EwingTo ask the Chancellor of the Exchequer what would be the equivalent in real terms of the salary at which car benefit tax becomes payable if the salary level of £8,500 in 1976 terms were translated to 1988 terms.
§ Mr. Norman Lamont[holding answer 5 May 1988]: The earnings threshold at which the benefit of a company car provided for private use becomes taxable was £5,000 in 1976–77. If this threshold had been indexed in line with inflation according to the statutory formula for increasing personal allowances and thresholds, the threshold in 1988–89 would be £13,960. A salary level of £8,500 in 1976–77 would, if indexed in the same manner, be increased to £23,720 in 1988–89.
§ Mrs. Margaret EwingTo ask the Chancellor of the Exchequer what was the total amount accruable to the Exchequer as a result of car benefit tax in each of the past five years.
§ Mr. Norman Lamont[holding answer 5 May 1988]: The income tax liability in each of the years 1984–85 to 1988–89 arising from the scale changes for the private use of company cars is shown in the table.
£ million 1984–85 180 1985–86 210 1986–87 1260 1987–88 1310 1988–89 1540 1 Provisional
§ Mrs. Margaret EwingTo ask the Chancellor of the Exchequer what representations he has received seeking legislation to raise the tax threshold at which car benefit tax becomes payable; what response he has made; and if he will make a statement.
§ Mr. Norman Lamont[holding answer 6 May 1988]: My right hon. Friend the Chancellor of the Exchequer has received a number of representations suggesting an increase in the earnings threshold at which the company car scale charges and the charges on other benefits-in-kind are payable. The Government's view, which has been reflected in response to such representations, is that since in principle remuneration in kind should be treated in exactly the same way as cash remuneration irrespective of the level of the employee's earnings an increase in the threshold would not be justified.