Capital Gains Tax

HC Deb 20 January 1989 vol 145 cc359-60W

Mr. Dobson

To ask the Chancellor of the Exchequer what is the reduction in annual liability to(a) capital gains tax and (b) capital transfer tax in 1988–89 and 1989–90 as against the 1978–79 indexed regime, specifying in each case the total and average reduction per taxpayer as well as the number of taxpayers in each year.

Mr. Norman Lamont

[holding answer 16 January 1989]The information requested is given in the table:

		Capital gains tax	Capital transfer tax/Inheritance Tax
Reduction, compared with indexed 1978–79 regime, in:
Total liability (£m):	1988–89	1,250	610
	1989–90	1,150	670
Average liability1(£):	1988–89	1,450	7,200
	1989–90	1,500	7,700
Taxpayer numbers(thousands)
1978–79 indexed regime:	1988–89	850	85
	1989–90	760	87
Present regime:	1988–89	155	25
	1989–90	145	26
1 The reduction in the average liability is calculated using the numbers of taxpayers under the 1978–79 indexed regime.

The figures for capital gains tax exclude capital gains realised by companies and taxed within corporation tax. The figures for 1989–90 for the "present regime" assume the same tax structure as in 1988–89 except for indexation of allowances. For each tax, the 1988–89 and 1989–90 tax bases are taken as given. It is not possible to determine to what extent changes to the taxes between 1978–79 and the present may have affected the levels of transfers and disposals.