§ Mr. Austin MitchellTo ask the Chancellor of the Exchequer whether the calculations in annex C of "Inland Revenue Statistics 1987" included the man's national insurance contribution; what was the change in the rate of contribution over the period; and if he will provide an estimate of the threshold figure for the current financial year.
§ Mr. Norman LamontAnnex C of "Inland Revenue Statistics 1987" shows the income tax threshold and the break-even points since 1949–50 for different family types. The tax threshold is the personal allowance due, the break-even point (for families with children) is the value of earnings at which income tax paid is equal to the money received through child benefit or family allowance. National insurance contributions are not included.
For comparisons over a number of years, the annex gives the threshold as a percentage of average earnings, before deduction of national insurance contributions.
In 1949–50 employees paid flat rate national insurance contributions, and in 1988–89 the rate of contribution will depend on the level of earnings.
In 1988–89 the tax thresholds at current prices are equal to the personal allowances for single people and married men announced in the Budget.