§ Mr. RedwoodTo ask the Chancellor of the Exchequer (1) what size of band at 10 per cent. tax could be introduced before reaching the 25 per cent. income tax rate for the loss of £2,000 million of revenue in a full year;
(2) what levels of income could be taxed at 15 per cent. instead of 25 per cent. for the loss of £2,000 million in a full year, if the 15 per cent. rate only applied to those with total incomes below the maximum qualifying level for the tax band at 15 per cent.
§ Mr. Norman LamontIt is estimated that a reduced rate band of 10 per cent. on the first £550 of taxable income would have an income tax cost of just under £2,000 million in a full year at 1989–90 levels of income.
For the same cost all single people and married couples with taxable incomes of less than £4,750 per annum could be taxed at 15 per cent. instead of 25 per cent.
Estimates are based on a projection on the 1986–87 survey of personal incomes and are provisional. It has been assumed that the indexed allowances and thresholds in table 4.1 of the Autumn Statement 1988 apply in 1989–90.