§ Mr. Chris SmithTo ask the Chancellor of the Exchequer (1) if he will update the answer given to the hon. Member for Colne Valley (Mr. Riddick) on 13 February 1989,Official Report, column 80, on composite rate tax on investment income;
(2) if he will update the answer on interest taxation given to the hon. Member for Dunfermline, East (Mr. Brown) on 10 January 1989, Official Report, column 630;
(3) if he will update the answer on taxation given to the hon. Member for Edinburgh, South (Mr. Griffiths) on 13 February 1989, Official Report, column 84.
§ Mr. Lilley[holding answer 8 March 1990]: The latest information is as follows. Estimates for 1986–87 are now final.
There were some 64 million accounts subject to composite rate and which earned over £1 interest in 1986–87, some of which were held by clubs or other non-individuals. Of these accounts, it is estimated that 49 million were held by investors whose composite rate interest would be wholly liable to tax in the absence of 165W composite rate system, and 13 million by investors none of whose composite rate interest would be liable. The balance of about 2 million accounts was held by investors part of whose interest would be liable to tax if there were no composite rate system.
In 1988–89, the latest year for which information is available, about £450 million of the composite rate tax accounted for by building societies, banks and other deposit takers was due in respect of interest that would not have been liable to tax in the hands of its recipients in the absence of a composite rate scheme, and about £3,050 million was due in respect of interest that would have been liable to tax.