§ Mr. Austin MitchellTo ask the Chancellor of the Exchequer what evidence he has as to the effect of the reduction in direct taxation on non-income benefits of directors of companies.
§ Mr. DorrellDirectors pay tax on their total income. The cash equivalent of any benefits in kind is added to money income for tax purposes. There has been no significant change in the proportion of directors receiving taxable benefits in kind. Reductions in income tax rates have applied equally to benefits in kind and other income. 21W Low income tax rates, which apply equally to benefits in kind and other income, promote incentives and wealth creation. This has contributed to the 40 per cent. increase in the real take-home pay of a family on average earnings since 1978–79.