§ Mr. BettsTo ask the Chancellor of the Exchequer if he will list for each year since 1979 the total tax yield from individual taxpayers liable for capital transfer tax, capital gains tax and inheritance tax; and if he will give for each year since 1989–90 the number of individual taxpayers liable for capital gains tax by their highest marginal rate of tax.
§ Sir George YoungThe available information on net receipts each year since 1979–80 from capital gains tax, capital transfer tax and inheritance tax is given in the table. Separate figures on capital gains tax receipts for individuals and trusts are not available but, in terms of tax liabilities, individuals account for between 83 per cent. and 90 per cent. of the total.
Inheritance Tax/Capital Transfer Tax1 £ million Capital Gains Tax2 Total of which charge on individuals3 Total 1979–80 401 376 431 1980–814 425 401 508 1981–824 480 457 526 1982–83 499 475 632 1983–84 599 580 671 1984–85 658 621 730 1985–86 881 857 908 1986–87 988 963 1,064 1987–88 1,073 1,052 1,379 1988–89 1,067 1,042 2,323 1989–90 1,227 1,207 1,854 1990–91 1,259 1,233 1,852 1991–92 1,295 1,261 1,140 1992–93 1,201 1,170 982 1993–94 1,328 1,307 710 Notes:
1 Excludes small residual receipts from estate duty which was replaced by capital transfer tax in 1975.
2 Excludes tax on capital gains made by companies which is included under corporation tax.
3 Includes charges on settled property where the individual has an interest in possession.
4 The breakdown of receipts between 1980–81 and 1981–82 was estimated as they were affected by industrial action between March 1981 and July 1981.
The breakdown of capital gains taxpayers given in the table includes a separate column for trusts in order to reconcile with published figures on taxpayer numbers.
both earned and unearned, (b) total national insurance contributions paid and (c) total income tax paid by (i) the
1209Wtop 1 per cent., (ii) the top 5 per cent., (iii) the top 10 per cent., (iv) the bottom 50 per cent. and (v) all taxpayers.
§ Sir George YoungReadily available estimates based on the survey of personal incomes are in the tables. For 1978–79 and 1989–90, married couples are counted as one taxpayer and their incomes are combined. Following the introduction of independent taxation, for 1990–91 onwards, husbands and wives are counted separately. The estimates of total income relate to income subject to income tax and exclude non-taxable income such as certain social security benefits.
Quantile group of taxpayers1 Per cent. Total income £ million Income tax liability £ million Employees' and self-employed national insurance contribution liability £ million 1989–90 Top 1 24,200 7,800 300 Top 5 61,700 16,600 1,400 Top 10 93,400 22,600 2,700 Bottom 50 86,600 8,500 3,900 All taxpayers 323,400 53,400 14,400 1990–91 Top 1 28,300 9,200 300 Top 5 68,700 18,900 1,300 Top 10 102,800 25,400 2,700 Bottom 50 95,500 9,000 4,300 All taxpayers 358,300 60,400 15,500 1991–92 Top 1 31,200 10,400 300 Top 5 73,900 20,700 1,500 Top 10 109,600 27,500 3,000 Bottom 50 98,200 9,300 4,200 All taxpayers 373,800 63,500 16,200 1992–93 Top 1 29,300 9,200 300 Top 5 72,000 19,800 1,600 Top 10 108,100 26,500 3,100 Bottom 50 96,900 8,000 4,000 All taxpayers 373,700 60,700 16,300 1993–94 Top 1 29,900 9,800 300 Top 5 73,900 20,400 1,700 Top 10 111,300 27,500 3,400 Bottom 50 96,800 8,100 3,900 All taxpayers 381,400 62,800 17,100 1994–95 Top 1 32,000 10,800 400 Top 5 78,900 22,800 2,000 Top 10 118,700 30,900 3,900 Bottom 50 99,600 9,000 4,400 All taxpayers 401,000 69,700 20,000 1 Tax units for years prior to 1990–91.
§ Mr. BettsTo ask the Chancellor of the Exchequer what would be the effect on the number of taxpayers in the financial year 1995–96 and on the number of higher rate taxpayers of(a) indexation, (b) raising the main personal allowances by 5 per cent. more than indexation and (c) raising personal allowances by 10 per cent. more than indexation, giving figures separately for each main allowance and a total for main allowances. 1210W
Quantile group of taxpayers1 Per cent. Total income £ million Income tax liability £ million 1978–79 Top 1 5,000 2,300 Top 5 14,900 4,900 Top 10 24,200 7,000 Bottom 50 30,300 3,900 All taxpayers 102,800 20,300 1 Tax units years prior to 1990–91.
§ Sir George YoungEstimates based on statutory indexation of 2.2 per cent. in line with the September retail prices index and income levels projected to 1995–96 levels using the summer economic forecast are given in the table. The levels of the married couple's allowance and linked allowances in 1995–96 were set in the Finance Act 1994 and will therefore not be subject to the statutory indexation rules. 1211W
Estimated number of income taxpayers 1995–96 Total millions Of which higher rate taxpayers a) Indexation 26.5 2.6 b) Increasing personal allowance for those aged under 65 by 5 per cent. more than indexation 26.2 2.5 Increasing personal allowance for those aged 65 or over by 5 per cent. more than indexation. 26.4 2.6 Increasing all personal allowances by 5 per cent. more than indexation 26.1 2.5 c) Increasing personal allowance for those aged under 65 by 10 per cent. more than indexation 26.0 2.5 Increasing personal allowance for those aged 65 or over by 10 per cent. more than indexation 26.2 2.6 Increasing all personal allowances by 10 per cent more than indexation 25.7 2.5
§ Mr. BettsTo ask the Chancellor of the Exchequer if he will estimate the direct revenue yield in a full year at 1994–95 levels of income from restricting(a) personal allowances, (b) relief from pension contributions arid (c) other reliefs to relief at 25p and (d) 20p giving in each case the numbers of people affected.
§ Sir George YoungEstimated full-year yields at 1994–95 income levels based on a projection of the 1992–93 survey of personal incomes and other survey data are given in the table. The figures do not take account of any behavioural effects which might result from the introduction of such changes, and show the yield from restructuring each allowance of relief separately. If two or more were restricted the total yield would be greater than the sum of individual figures.
Restriction to Basic Rate 20p Effect of restricting Yield £ million Numbers affected millions Yield £ million Numbers affected millions (a) Personal allowances 1,490 3.4 5,650 26.2 (b) Relief for pension contributions 700 2.0 1,350 11.5 (c) Other reliefs 140 0.7 1n/a n/a 1 Information on reliefs given at source is not available from the Survey of Personal Incomes so it is not possible to estimate the effect of restricting other reliefs to 20 per cent.
§ Mr. BettsTo ask the Chancellor of the Exchequer if he will update his answer to the hon. Member for Glasgow, Garscadden (Mr. Dewar) of 5 November 1993,Official Report, column 549 on mortgage tax relief, giving estimates for 1995–96 and for a full year.
§ Sir George YoungEstimates for 1995–96 are given in the table. The figures are based on the conventional1212W assumption of no changes in interest rates from current levels and allow for tax relief 15 per cent. as set in the Finance Act 1994. They exclude any behavioural effects with might result.
Cost (yield) from increasing (decreasing) in limit on mortgage interest relief Limit on size of loan £ £ million 40,000 400 35,000 200 32,000 100 31,000 50 29,000 (50) 28,000 (l00) 25,000 (300) 20,000 (700)
§ Mr. BettsTo ask the Chancellor of the Exchequer if he will estimate for 1993–94 the number of self-employed who will pay no income tax, giving figures separately for those with gross incomes(a) under £5,000 a year, (b) between £5,000 and £10,000 a year, (c) between £10,000 and £15,000 a year, (d) between £15,000 and £20,000 a year and (e) over £20,000 a year.
§ Sir George YoungThere are about 770,000 self-employed with no income tax liability in 1993–94. Of these, 670,000 have gross income of under £5,000 and 100,000 have gross income of over £5,000.
The estimates are based on the projection of the latest annual survey of personal incomes and are provisional. The number with gross income above £5,000 is too small to allow any separate breakdown.
§ Mr. BettsTo ask the Chancellor of the Exchequer if he will list for 1995–96 or the latest year available an estimate of the yield and the number of taxpayers affected by restricting the capital gains tax allowance to relief at the(a) 25 pence rate and (b) 20 pence rate.
§ Sir George YoungUnder current rules net chargeable gains below the capital gains tax annual exempt amount are totally exempt from tax. The effects of restricting this relief at the 25 per cent. and 20 per cent. rates are given in the table below based on forecast 1994–95 liabilities. The estimates assume the restriction would only affect individuals with gains above the annual exempt amount and do not allow for any consequential change in their behaviour.
Number of taxpayers affected Capital gains tax yiels (£ million) Restricting the relief to: (a) 25 per cent rate 45,000 35 (b) 20 per cent. 75,000 60
§ Mr. BettsTo ask the Chancellor of the Exchequer how much tax was remitted or written off as irrecoverable in 1993; and how much of this was pay-as-you-earn contributions.
§ Sir George YoungIn 1993, £1.58 billion was written off as irrecoverable by the Inland Revenue and £400 million of this was pay-as-you-earn contributions.