§ Mr. CarrTo ask the Secretary of State for Social Security what would be the effect in 1991–92 and 1992–93, on both a first year and a full year basis, on the national insurance contributions of(a) employees, (b) employees and the self-employed, if (i) national insurance contributions were chargeable at the current rates on fringe benefits, (ii) national insurance contributions were chargeable at the current rates on unearned income of those under retirement age in excess of £60 per week, (iii) the ceilings on contributions were abolishied, (iv) a combination of (i), (ii) and (iii) and (v) as (iv), but if the contracting-out rebates were abolished and the current 9 per cent. contribution rate was cut to 8 per cent.
§ Mr. JackThe information requested is as follows: (i) The yield in a full year for 1991–92 for employees in the United Kingdom is estimated to be £230 million.
373WThe estimates are based on an employee contribution rate of 9 per cent.
Figures are not available for self-employed people.
The yield in the first year would depend on the administrative arrangements made for collecting such a charge.
The yield for 1992–93 would depend on the level of employer-provided benefits in that year.
It is not possible to provide separate estimates for Great Britain and Northern Ireland.
(ii) The yield in a full year for 1991–92 for individuals in the United Kingdom is estimated at:
£ million (a) Employees 640 (b) Employees and self-employed 810 The estimates are based on an employee contribution rate of 9 per cent.
The amount of revenue collected in the first year would depend on the administrative arrangements for collecting such a charge.
The yield for 1992–93 would depend on the levels of investment income for that year. These estimates take no account of any behavioural changes following the introduction of such a charge.
The figures do not include people who are neither employees nor self-employed, but who nevertheless receive investment income.
It is not possible to provide separate information for Great Britain and Northern Ireland.
(iii) Revenue yield First year £ billion Full year £ billion 1991–92 (employees only) 2.2 2.5 1991–92 (employees plus self-employed) 2.4 2.9 1992–93 (employees only) 2.4 2.7 1992–93 (employees plus self-employed) 2.6 3.2
(iv) Revenue yield Full year £ billion 1991–92 (employees only) 3.8 1991–92 (employees plus self-employed) 4.3 All notes to parts (i) and (ii) apply here.
(v) Revenue yield Full year £ billion 1991–92 (employees only) 7.6 1991–92 (employees plus self-employed) 18.2 All notes to parts (i) and (ii) apply here. 1 Assumes that the Class 4 contribution rate remains at 6.3 per cent. If the contracted-out rebates and 2 per cent. incentives in respect of personal pensions and 2 per cent. incentives for contracted-out schemes were also abolished, there would be additional yield of £2.9 billion in a full year in 1991–92.