HC Deb 19 December 1994 vol 251 cc943-4W
Mr. Burden

To ask the Chancellor of the Exchequer what has been the reduction in income to the Exchequer, to date, from the changes in the 1993 Budget which extended mortgage tax relief to loans taken from non-British lenders.

Sir George Young

[holding answer 16 December 1994]: Negligible to date, since the first tax year to which this provision applies is the current year. No estimate can be made of the longer-term cost. But it is likely to be slight: the main effect of the change is on non-residents buying United Kingdom property for letting rather than on mortgage tax relief for owner-occupiers. In the latter case, relief on loans by non-United Kingdom lenders would already, in general, have been available under pre-existing law.

Mr. Burden

To ask the Chancellor of the Exchequer what is the reduction in income to the Exchequer from the changes in the Budget which allow people with a mortgage on an overseas property rented out all year to offset, against income tax, the interest paid on the loan.

Sir George Young

[holding answer 16 December 1994]: This measure, to bring the treatment of income from the letting of properties overseas more into line with

Income tax, National Insurance and indirect taxes at multiples of average earnings 1993–94
Percentage of average male earnings
50 75 100 150 200 300 400 500 700 1,000 2,000
Single
Amounts, £ per week Gross income 179.55 269.33 359.10 538.65 718.20 1,077.30 1,436.40 1,795.50 2,513.70 3,591.00 7,182.00
Income tax and NICs 38.16 68.68 99.21 152.07 223.89 367.53 511.17 654.81 942.09 1,373.01 2,809.41
Indirect taxes1 34.37 43.86 64.17
Total 103.05 143.07 216.24
Percentage of earnings Income tax and NICs 21.3 25.5 27.6 28.2 31.2 34.1 35.6 36.5 37.5 38.2 39.1
Indirect taxes1 12.8 12.2 11.9
Total 38.3 39.8 40.1
Married no children
Amounts, £ per week
Gross income 179.55 269.33 359.10 538.65 718.20 1,077.30 1,436.40 1,795.50 2,513.70 3,591.00 7,182.00
Income tax and NICs 29.89 60.41 90.94 141.31 210.66 354.30 497.94 641.58 928.86 1,359.78 2,796.18
Indirect taxes1 35.50 45.52 67.37
Total 95.91 136.46 208.68
Percentage of earnings
Income tax and NICs 16.6 22.4 25.3 26.2 29.3 32.9 34.7 35.7 37.0 37.9 38.9
Indirect taxes1 13.2 12.7 12.5
Total 35.6 38.0 38.7

that of letting United Kingdom properties, is likely to have a negligible effect on Exchequer receipts.

Forward to