§ Mr. DewarTo ask the Chancellor of the Exchequer (1) if he will estimate the number of people who would have an income tax liability in 1993–94 whose sole income was invalidity benefit if invalidity benefit were liable to tax in 1993–94; and what would be their average annual payment;
(2) how many recipients of invalidity benefit would be liable to tax if the benefit was taxed in 1993–94; and what would be their average annual tax payment;
(3) how much would be raised in 1993–94 by taxing invalidity benefit.
§ Mr. Dorrell[holding answer 8 March 1993]: Approximate estaimates are that the yield, at 1993–94 508W levels, from making invalidity benefit taxable would be about £450 million, assuming statutory indexation of income tax allowances and bands.
The estimated number of recipients who would have an income tax liability and the average increase in tax is shown in the table:
Number of taxpayers with invalidity benefit liable to tax Average increase in tax with invalidity benefit liable to tax All recipients of invalidity benefit 1750,000 £600 Invalidity benefit recipients with no other income 80,000 £150 1 Of which some 250,000 already have an income tax liability.