Tax (Hansard, 16 March 1990)

§ Mr. Chris Smith
To ask the Secretary of State for Social Security if he will publish a table showing the number of(a) working heads and (b) dependants facing marginal tax and benefit withdrawal rates in excess of 40 per cent. in the manner of his answer to the late hon. Member for Kensington on 25 March 1988, Official Report, column 244.

§ Mrs. Gillian Shephard
The latest available information is set out in the table. The table shows the number of tax units where the head faces a combined withdrawal rate above 50 per cent., and the total number of individuals, including spouses and children, in their families.
per cent., (b) over 50 per cent., (c) over 60 per cent., (d) 403W over 70 per cent., (e) over 80 per cent., (f) over 90 per cent. and (g) over 100 per cent.; (i) now and (ii) in each year since 1978–79.

§ Mrs. Gillian Shephard
Available estimates are set out in the table. The first table shows the number of tax units facing combined marginal tax/benefit withdrawal rates in the requested ranges, in 1985 and as currently projected for 1989–90. These are the only years for which estimates on a comparable basis are available. The second table shows the number of tax units facing marginal rates of income tax in the requested ranges. Estimates are provided for 1985–86 and 1989–90, to be comparable with those provided incorporating social security withdrawal rates, and also for 1978–79.

Table 1: Marginal deduction rates—working heads of tax units, in Great Britain

Numbers with marginal deduction rales in specified range¹

Percentage November 1985² 1989–90³

Thousands Thousands

100 and over 70 —

90 to 99 60 40

80 to 89 160 130

70 to 79 — 180

60 to 69 160 5

50 to 59 230 ⁴

40 to 49 n.a. 30

¹ Marginal deduction rates shown are for heads of benefit units in receipt of family credit (previously family income supplement) or housing benefit where at least one partner works 24 hours or more a week.

² Based on 1982, 1983 and 1984 Family Expenditure Surveys.

³ Projection based on 1985 and 1986 FES. Shows the position post October 1989 national insurance contribution changes.

⁴Denotes an estimate of fewer than 2,500.

n.a. Denotes not available.

Table 2 Marginal rate of income tax—tax units. Great Britain Numbers with marginal rate of income tax in specified range¹

1978–79 1985–86 1989–90

thousands thousands thousands

100 per cent, and over — — —

90 to 99 per cent. 20 — —

80 to 89 per cent. 50 — —

70 to 79 per cent. 60 — —

60 to 69 per cent. 90 — —

50 to 59 per cent. 170 170 —

40 to 49 per cent. 590 530 —

¹ Estimates based on 1978–79 and 1985–86 Surveys of Personal Incomes. Estimates allow for taxpayers in the aged withdrawal band (where the marginal rate of income tax was 55 per cent, in 1978–79, 50 per cent, in 1985–86 and 37.5 per cent, in 1989–90) and for Investment Income Surcharge rates of 10 per cent, and 15 per cent, in 1978–79.

Table 1: Marginal deduction rates—working heads of tax units, in Great Britain
Numbers with marginal deduction rales in specified range¹
Percentage	November 1985²	1989–90³
	Thousands	Thousands
100 and over	70	—
90 to 99	60	40
80 to 89	160	130
70 to 79	—	180
60 to 69	160	5
50 to 59	230	⁴
40 to 49	n.a.	30
¹ Marginal deduction rates shown are for heads of benefit units in receipt of family credit (previously family income supplement) or housing benefit where at least one partner works 24 hours or more a week.
² Based on 1982, 1983 and 1984 Family Expenditure Surveys.
³ Projection based on 1985 and 1986 FES. Shows the position post October 1989 national insurance contribution changes.
⁴Denotes an estimate of fewer than 2,500.
n.a. Denotes not available.

Table 2 Marginal rate of income tax—tax units. Great Britain Numbers with marginal rate of income tax in specified range¹
	1978–79	1985–86	1989–90
	thousands	thousands	thousands
100 per cent, and over	—	—	—
90 to 99 per cent.	20	—	—
80 to 89 per cent.	50	—	—
70 to 79 per cent.	60	—	—
60 to 69 per cent.	90	—	—
50 to 59 per cent.	170	170	—
40 to 49 per cent.	590	530	—
¹ Estimates based on 1978–79 and 1985–86 Surveys of Personal Incomes. Estimates allow for taxpayers in the aged withdrawal band (where the marginal rate of income tax was 55 per cent, in 1978–79, 50 per cent, in 1985–86 and 37.5 per cent, in 1989–90) and for Investment Income Surcharge rates of 10 per cent, and 15 per cent, in 1978–79.