§ Mr. Nicholas BrownTo ask the Chancellor of the Exchequer what is the annual reduction in income tax for a person on an annual income of(a) £10,000, (b) £20,000, (c) £30,000, (d) £40,000, (e) £70,000 and (f) £150,000 as a result of income tax changes since the 1988 Budget.
§ Mr. Maude[holding answer 25 February 1991]: The information is in the table, which compares the income tax liability in 1990–91 with liability under 1988–89 rates of tax with allowances and thresholds indexed to 1990–91 levels by reference to movements in the RPI. The calculations are for a single, non-aged person with no reliefs or allowances apart from the personal allowance.
Annual income £ Increase in tax liability £ 10,000 0 20,000 0 30,000 225 40,000 225 70,000 225 150,000 225
§ Mr. Nicholas BrownTo ask the Chancellor of the Exchequer what is the average individual cumulative gain(a) in current prices and (b) in 1990–91 prices to those earning £5,000, £10,000, £15,000, £20,000, £25,000, £30,000, £40,000, £50,000, £60,000 and £70,000 a year as a result of changes in income tax since 1979.
§ Mr. Maude[holding answer 25 February 1991]: Latest estimates of the annual change in income tax liability resulting from the changes in tax rates, allowances and thresholds are in the table. The 1978–79 income tax regime has been indexed to 1990–91 levels of reference to the statutory formula, and allowing for independent taxation.
For the purposes of these calculations the indexed regime of 1978–79 is applied directly to the income base of 1990–91. In practice, retention of the regime, indexed as appropriate, for the intervening years would have led to changes in the income base.
166W
1989–901 1990–912 Group of income taxpayers Total earned income Average earned income Total investment income Average investment income Total earned income Average earned income Total investment income Average investment income £ billion £ per annum £ billion £ per annum £ billion £ per annum £ billion £ per annum Top 1 per cent. 17.8 82,800 6.9 32,200 20.6 78,800 7.4 28,200 Top 5 per cent. 49.7 46,000 12.2 11,300 55.4 42,200 13.0 10,000 Top 10 per cent. 78.5 36,300 15.6 7,300 85.6 32,500 16.7 6,500 Bottom 70 per cent. 134.2 8,900 11.6 880 150.1 8,200 13.5 870 Bottom 50 per cent. 79.4 7,400 7.5 820 88.7 6,800 8.9 830 Bottom 10 per cent. 10.2 4,800 n/a n/a 11.2 4,300 n/a n/a All taxpayer 292.3 13,500 33.6 1,700 321.7 12,200 37.1 1,600 1 Counting married couples as one unit. 2 Counting husbands and wives as separate individuals under independent taxation. n/a Estimates not available.
Average reduction in income tax per individual1 in 1990–91 compared with 1978–79 indexed regime Range of individual's income in 1990–91 (£) Average reduction at 1990–91 prices (£) Under 5,000 130 5,000 to 10,000 360 10,000 to 15,000 650 15,000 to 20,000 930 20,000 to 25,000 1,250 25,000 to 30,000 1,680 30,000 to 40,000 2,340 40,000 to 50,000 4,000 50,000 to 60,000 6,830 60,000 to 70,000 9,980 Over 70,000 36,430 Total 910 1 Individuals paying income tax under the 1978–79 indexed regime.
§ Mr. NellistTo ask the Chancellor of the Exchequer how many tax units and individuals had(a) earned income and (b) total income in the top (1) 1 per cent., (2) 5 per cent. and (3) 10 per cent., and the bottom (i) 10 per cent. and (ii) 50 per cent. of the earnings and income distribution, respectively.
§ Mr. Maude[holding answer 27 February 1991]: In 1990–91 it is estimated that there are 26.5 million individuals liable to income tax of whom 26.3 million have earned income. Information is accordingly as follows:
Thousands Number of individual taxpayers in 1990–91 Earned income distribution Total income distribution Top 1 per cent. 300 300 Top 5 per cent. 1,300 1,300 Top 10 per cent. 2,600 2,600 Bottom 10 per cent. 2,500 2,600 Bottom 50 per cent. 13,100 13,200