Taxation (Hansard, 11 December 1996)

§ Mr. Jack

[holding answer 27 November 1996]: The tables show estimates of tax payments for the requested specimen households for the years 1994–95 to 1997–98.

The main factors accounting for the increase in payments between years are growth in earnings and inflation. The figures for tax payments do not measure the effects of changes in tax rates, allowances, etcetera. A one-earner couple on average earnings with two children will pay £88 less in income tax and national insurance contributions next year than if these taxes had been left unchanged since 1991–92, apart from indexation.

Real take-home pay for all these households will rise next year and will be substantially higher than in 1991–92. For the family on average earnings, the increase next year will be £370, bringing the total rise since 1991–92 to over £1,100. These increases take account of all taxes as well as earnings growth and inflation. Other factors are also boosting living standards, such as the lowest mortgage rates for 30 years and the rise in employment by ¾ million since 1992.

The figures for tax payments are subject to important limitations. The estimates of indirect tax payments are very approximate. They are based on the assumption that these taxes are fully passed on in prices, which may not hold in practice. They also assume particular spending patterns by the households whereas in practice there are wide variations in spending on taxed goods, and hence in indirect tax payments, between households with similar incomes and compositions. Nor do the estimates include the effects of changes in tax on savings, particularly the reduction in the tax rate on savings income to 20 per cent. for basic rate payers or the growth in tax-free tax-exempt special savings accounts and personal equity plans, as the households specified have income only from earnings. The overall tax burden—total taxes and national insurance contributions as a percent of GDP—which includes the impact of all taxes is expected to be at the same level next year as in 1991–92.

191W

Income tax, national insurance and indirect taxes at multiples of average earnings 1994–95	Percentage of male average earnings
	50	75	100	150	200	300	400	500	700	1,000	2,000
Single person
£ per week
Gross income	184.55	276.83	369.10	553.65	738.20	1,107.30	1,476.40	1,845.50	2,583.70	3,691.00	7,382.00
NICs	13.90	23.12	32.35	38.44	38.44	38.44	38.44	38.44	38.44	38.44	38.44
Income tax	26.69	49.76	72.83	123.71	197.53	345.17	492.81	640.45	935.73	1,378.65	2,855.05
VAT		14.84	19.78	30.29
Other indirect taxes		20.05	25.53	37.19
Total excluding council tax		107.78	150.49	229.63
Council tax		7.10	7.34	7.87
Real take-home pay (1996–97 prices)	151.79	215.02	278.26	412.77	529.52	763.01	996.50	1,230.00	1,696.98	2,397.46	4,732.38
Percentage of earnings
NICs	7.5	8.4	8.8	6.9	5.2	3.5	2.6	2.1	1.5	1.0	0.5
Income tax	14.5	18.0	19.7	22.3	26.8	31.2	33.4	34.7	36.2	37.4	38.7
VAT		5.4	5.4	5.5
Other indirect taxes		7.2	6.9	6.7
Total excluding council tax		38.9	40.8	41.5
Council tax		2.6	2.0	1.4
Married couple, one earner: no children
£ per week
Gross income	184.55	276.83	369.10	553.65	738.20	1,107.30	1,476.40	1,845.50	2,583.70	3,691.00	7,382.00
NICs	13.90	23.12	32.35	38.44	38.44	38.44	38.44	38.44	38.44	38.44	38.44
Income tax	20.08	43.14	66.21	117.09	190.91	338.55	486.19	633.83	929.11	1,372.03	2,848.43
VAT		15.34	20.84	32.54
Other indirect taxes		21.47	25.61	34.43
Total excluding council tax		103.08	145.01	222.50
Council tax		9.36	10.06	11.54
Real take-home pay (1996–97 prices)	158.76	222.00	285.24	419.75	536.49	769.98	1,003.48	1,236.97	1,703.%	2,404.43	4,739.36
Percentage of earnings
NICs	7.5	8.4	8.8	6.9	5.2	3.5	2.6	2.1	1.5	1.0	0.5
Income tax	10.9	15.6	17.9	21.1	25.9	30.6	32.9	34.3	36.0	37.2	38.6
VAT		5.5	5.6	5.9
Other indirect taxes		7.8	6.9	6.2
Total excluding council tax		37.2	39.3	40.2
Council tax		3.4	2.7	2.1
Married couple, one earner: 2 children
£ per week
Gross income	184.55	276.83	369.10	553.65	738.20	1,107.30	1,476.40	1,845.50	2,583.70	3,691.00	7,382.00
NICs	13.90	23.12	32.35	38.44	38.44	38.44	38.44	38.44	38.44	38.44	38.44
Income tax (less child benefit)	1.63	24.69	47.76	98.64	172.46	320.10	467.74	615.38	910.66	1,353.58	2,829.98
VAT		15.33	20.30	30.88
Other indirect taxes		24.99	28.01	34.43
Total excluding council tax		88.13	128.42	202.40
Council tax		8.72	9.21	10.27
Real take-home pay (1996–97 prices)	178.21	241.45	304.69	439.20	555.94	789.44	1,022.93	1,256.42	1,723.41	2,423.89	4,758.81
Percentage of earnings
NICs	7.5	8.4	8.8	6.9	5.2	3.5	2.6	2.1	1.5	1.0	0.5
Income tax (less child benefit)	0.9	8.9	12.9	17.8	23.4	28.9	31.7	33.3	35.2	36.7	38.3
VAT		5.5	5.5	5.6
Other indirect taxes		9.0	7.6	6.2
Total excluding council tax		31.8	34.8	36.6
Council tax		3.1	2.5	1.9
Married couple, 2 earners: no children:
Earnings split 60:40
£ per week
Gross income	184.55	276.83	369.10	553.65	738.20	1,107.30	1,476.40	1,845.50	2,583.70	3,691.00	7,382.00
NICs	9.34	18.56	27.79	46.25	63.41	76.88	76.88	76.88	76.88	76.88	76.88
Income tax	3.79	24.36	46.77	92.90	139.04	252.67	388.44	536.08	831.36	1274.28	2750.68
VAT		16.67	22.14	32.98
Other indirect taxes		24.78	29.92	40.08
Total excluding council tax		84.37	126.62	212.20
Council tax		9.55	9.74	10.12
Real take-home pay (1996–97 prices)	180.73	246.61	310.55	437.02	564.86	820.01	1,066.01	1,299.50	1,766.49	2,466.97	4,801.89

192W 193W

Income tax, national insurance and indirect taxes at multiples of average earnings 1994–95	Percentage of male average earnings
	50	75	100	150	200	300	400	500	700	1,000	2,000
Percentage of earnings
NICs	5.1	6.7	7.5	8.4	8.6	6.9	5.2	4.2	3.0	2.1	1.0
Income tax	2.1	8.8	12.7	16.8	18.8	22.8	26.3	29.0	32.2	34.5	37.3
VAT		6.0	6.0	6.0
Other indirect taxes		9.0	8.1	7.2
Total excluding council tax		30.5	34.3	38.3
Council tax		3.5	2.6	1.8

Income tax, national insurance and indirect taxes at multiples of average earnings 1995–96	Percentage of male average earnings
	50	75	100	150	200	300	400	500	700	1000	2000
Single person
£ per week
Gross income	190.60	285.90	381.20	571.80	762.40	1,143.60	1,524.80	1,906.00	2,668.40	3,812.00	7,624.00
NICs	14.42	23.95	33.48	39.36	39.36	39.36	39.36	39.36	39.36	39.36	39.36
Income tax	27.63	51.45	75.28	128.43	204.67	357.15	509.63	662.11	967.07	1,424.51	2,949.31
VAT		15.06	20.08	30.75
Other indirect taxes		21.75	27.66	40.21
Total excluding council tax		112.20	156.49	238.76
Council tax		7.51	7.77	8.32
Real take-home pay (1996–97 prices)	151.72	214.99	278.25	412.62	529.42	763.02	996.61	1,230.21	1,697.40	2,398.19	4,734.15
Percentage of earnings
NICs	7.6	8.4	8.8	6.9	5.2	3.4	2.6	2.1	1.5	1.0	0.5
Income tax	14.5	18.0	19.7	22.5	26.8	31.2	33.4	34.7	36.2	37.4	38.7
VAT		5.3	5.3	5.4
Other indirect taxes		7.6	7.3	7.0
Total excluding council taxes		39.2	41.1	41.8
Council tax		2.6	2.0	1.5
Married couple, one earner: no children
£ per week
Gross income	190.60	285.90	381.20	571.80	762.40	1,143.60	1,524.80	1,906.00	2,668.40	3,812.00	7,624.00
NICs	14.42	23.95	33.48	39.36	39.36	39.36	39.36	39.36	39.36	39.36	39.36
Income tax	22.66	46.49	70.31	123.47	199.71	352.19	504.67	657.15	962.11	1,419.55	2,944.35
VAT		15.37	20.96	32.83
Other indirect taxes		23.45	27.87	37.27
Total excluding council tax		109.26	152.63	232.93
Council tax		9.87	10.60	12.15
Real take-home pay (1996–97 prices)	156.79	220.05	283.32	417.69	534.49	768.08	1001.68	1235.28	1702.47	2403.26	4739.22
Percentage of earnings
NICs	7.6	8.4	8.8	6.9	5.2	3.4	2.6	2.1	1.5	1.0	0.5
Income tax	11.9	16.3	18.4	21.6	26.2	30.8	33.1	34.5	36.1	37.2	38.6
VAT		5.4	5.5	5.7
Other indirect taxes		8.2	7.3	6.5
Total excluding council tax		38.2	40.0	40.7
Council tax		3.5	2.8	2.1
Married couple, one earner: 2 children
£ per week
Gross income	190.60	285.90	381.20	571.80	762.40	1,143.60	1,524.80	1,906.00	2,668.40	3,812.00	7,624.00
NICs	14.42	23.95	33.48	39.36	39.36	39.36	39.36	39.36	39.36	39.36	39.36
Income tax (less child benefit)	3.81	27.64	51.46	104.62	180.86	333.34	485.82	638.30	943.26	1,400.70	2,925.50
VAT		15.36	20.42	31.16
Other indirect taxes		27.34	30.60	37.51
Total excluding council tax		94.29	135.96	212.64
Council tax		9.20	9.72	10.82
Real take-home pay (1996–97 prices)	176.04	239.31	302.57	436.94	553.74	787.33	1,020.93	1,254.53	1,721.72	2,422.51	4,758.47
Percentage of earnings
NICs	7.6	8.4	8.8	6.9	5.2	3.4	2.6	2.1	1.5	1.0	0.5
Income tax (less child benefit)	2.0	9.7	13.5	18.3	23.7	29.1	31.9	33.5	35.3	36.7	38.4
VAT		5.4	5.4	5.4
Other indirect taxes		9.6	8.0	6.6
Total excluding council tax		33.0	35.7	37.2
Council tax		3.2	2.5	1.9

194W 195W

Income tax, national insurance and indirect taxes at multiples of average earnings 1995–96	Percentage of male average earnings
	50	75	100	150	200	300	400	500	700	1000	2000
Married couple, 2 earners, no children:
Earnings split 60:40
£ per week
Gross income	190.60	285.90	381.20	571.80	762.40	1,143.60	1,524.80	1,906.00	2,668.40	3,812.00	7,624.00
NICs	9.78	19.31	28.84	47.90	65.22	78.72	78.72	78.72	78.72	78.72	78.72
Income tax	6.04	27.21	50.29	97.94	145.59	263.55	404.38	556.86	861.82	1,319.26	2,844.06
VAT		16.69	22.27	33.28
Other indirect taxes		26.94	32.64	43.93
Total excluding council tax		90.15	134.04	223.05
Council tax		10.11	10.31	10.71
Real take-home pay (1996–97 prices)	178.50	244.48	308.51	435.04	563.35	818.41	1063.91	1297.50	1764.69	2465.48	4801.44
Percentage of earnings
NICs	5.1	6.8	7.6	8.4	8.6	6.9	5.2	4.1	3.0	2.1	1.0
Income tax	3.2	9.5	13.2	17.1	19.1	23.0	26.5	29.2	32.3	34.6	37.3
VAT		5.8	5.8	5.8
Other indirect taxes		9.4	8.6	7.7
Total excluding council tax		31.5	35.2	39.0
Council tax		3.5	2.7	1.9

Income tax, national insurance and indirect taxes at multiples of average earnings 1996–97	Percentage of male average earnings
	50	75	100	150	200	300	400	500	700	1000	2000
Single person
£ per week
Gross income	197.75	296.63	395.50	593.25	791.00	1,186.50	1,582.00	1,977.50	2,768.50	3,955.00	7,910.00
NICs	14.90	24.78	34.67	40.62	40.62	40.62	40.62	40.62	40.62	40.62	40.62
Income tax	27.08	50.81	74.54	126.88	205.98	364.18	522.38	680.58	996.98	1,471.58	3,053.58
VAT		16.41	21.91	33.66
Other indirect taxes		23.27	29.63	43.23
Total excluding council tax		115.27	160.75	244.38
Council tax		7.74	8.01	8.57
Real take-home pay Percentage of male average earnings (1996–97 prices)	155.77	221.03	286.29	425.75	544.40	781.70	1,019.00	1,256.30	1,730.90	2,442.80	4,815.80
Percentage of earnings
NICs	7.5	8.4	8.8	6.8	5.1	3.4	2.6	2.1	1.5	1.0	0.5
Income tax	13.7	17.1	18.8	21.4	26.0	30.7	33.0	34.4	36.0	37.2	38.6
VAT		5.5	5.5	5.7
Other indirect taxes		7.8	7.5	7.3
Total excluding council tax		38.9	40.6	41.2
Council tax		2.6	2.0	1.4
Married couple, one earner: no children
£ per week
Gross income	197.75	296.63	395.50	593.25	791.00	1,186.50	1.582.00	1,977.50	2,768.50	3,955.00	7,910.00
NICs	19.90	24.78	34.67	40.62	40.62	40.62	40.62	40.62	40.62	40.62	40.62
Income tax	21.92	45.65	69.38	121.71	200.81	359.01	517.21	675.41	991.81	1,466.41	3,048.41
VAT		16.72	22.84	35.92
Other indirect taxes		25.07	29.78	39.85
Total excluding council tax		112.22	156.67	238.10
Council tax		10.15	10.90	12.51
Real take-home pay (1996–97 prices)	160.94	226.19	291.45	430.92	549.57	786.87	1,024.87	1,261.47	1,736.07	2,447.97	4,820.97
Percentage of earnings
NICs	7.5	8.4	8.8	6.8	5.1	3.4	2.6	2.1	1.5	1.0	0.5
Income tax	11.1	15.4	17.5	20.5	25.4	30.3	32.7	34.2	35.8	37.1	38.5
VAT		5.6	5.8	6.1
Other indirect taxes		8.5	7.5	6.7
Total excluding council tax		37.8	39.6	40.1
Council tax		3.4	2.8	2.1
Married couple, one earner: 2 children
£ per week
Gross income	197.75	296.63	395.50	593.25	791.00	1,186.50	1,582.00	1,977.50	2,768.50	3,955.00	7,910.00
NICs	14.90	24.78	34.67	40.62	40.62	40.62	40.62	40.62	40.62	40.62	40.62
Income tax (less child benefit)	2.32	26.05	49.78	102.11	181.21	339.41	497.61	655.81	972.21	1,446.81	3,028.81
VAT		16.70	22.23	34.07
Other indirect taxes		29.53	33.00	40.42

196W 197W

Income tax, national insurance and indirect taxes at multiples of average earnings 1996–97	Percentage of male average earnings
	50	75	100	150	200	300	400	500	700	1000	2000
Total excluding council tax		97.06	139.68	217.22
Council tax		9.47	10.00	11.14
Real take-home pay (1996–97 prices)	180.54	245.79	311.05	450.52	569.17	806.47	1,043.77	1,281.07	1,755.67	2,467.57	4.840.57
Percentage of earnings
NICs	7.5	8.4	8.8	6.8	5.1	3.4	2.6	2.1	1.5	1.0	0.5
Income tax (less child benefit)	1.2	8.8	12.6	17.2	22.9	28.6	31.5	33.2	35.1	36.6	38.3
VAT		5.6	5.6	5.7
Other indirect taxes		10.0	8.3	6.8
Total excluding council tax		32.7	35.3	36.6
Council tax		32.2	2.5	1.9
Married couple, 2 earners, no children:
Earnings split 60:40
£ per week
Gross income	197.75	296.63	395.50	593.25	791.00	1,186.50	1,582.00	1,977.50	2,768.50	3,955.00	7.910.00
NICs	10.02	19.90	29.79	49.57	67.38	81.24	81.24	81.24	81.24	81.24	81.24
Income tax	5.42	26.42	49.00	96.46	143.92	262.70	406.79	564.99	881.39	1,355.99	2,937.99
VAT		18.07	24.20	36.26
Other indirect taxes		28.94	34.98	46.86
Total excluding council tax		93.34	137.98	229.15
Council tax		10.42	10.63	11.03
Real take-home pay (1996–96 prices)	182.31	250.30	317.71	447.22	579.70	842.56	1,093.97	1,331.27	1,805.87	2,517.77	4,890.77
Percentage of earnings
NICs	5.1	6.7	7.5	8.4	8.5	6.8	5.1	4.1	2.9	2.1	1.0
Income tax	2.7	8.9	12.4	16.3	18.2	22.1	25.7	28.6	31.8	34.3	37.1
VAT		6.1	6.1	6.1
Other indirect taxes		9.8	8.8	7.9
Total excluding council tax		31.5	34.9	38.6
Council tax		3.5	2.7	1.9

Income tax, national insurance and indirect taxes at multiples of average earnings 1997–98	Percentage of male average earnings
	50	75	100	150	200	300	400	500	700	1,000	2,000
Single person
£ per week
Gross income	205.65	308.48	411.30	616.95	822.60	1,233.90	1,645.20	2,056.50	2,879.10	4,113.00	8,226.00
NICs	15.61	25.89	36.17	41.54	41.54	41.54	41.54	41.54	41.54	41.54	41.54
Income tax	27.04	50.69	74.34	127.97	210.23	374.75	539.27	703.49	1,032.83	1,526.39	3,171.59
VAT		17.19	23.01	35.39
Other indirect taxes		25.09	32.07	46.93
Total excluding council tax		118.86	165.59	251.83
Real take-home pay (1996–97 prices)	156.06	226.29	293.51	436.61	557.02	797.83	1,038.64	1,279.45	1,761.07	2,483.51	4,891.61
Increase since 1991– 92	13.66	19.25	24.84	34.13	38.04	54.73	71.42	88.11	121.49	171.56	338.46
Increase since 1996– 97	3.29	5.26	7.22	10.86	12.62	16.13	19.64	23.15	30.17	40.71	75.81
Percentage of earnings
NICs	7.6	8.4	8.8	6.7	5.0	3.4	2.5	2.0	1.4	1.0	0.5
Income tax	13.1	16.4	18.1	20.7	25.6	30.4	32.8	34.2	35.9	37.1	38.6
VAT		5.6	5.6	5.7
Other indirect taxes		8.1	7.8	7.6
Total excluding council tax		38.5	40.3	40.8
Married couple, one earner: no children
£ per week
Gross income	205.65	308.48	411.30	616.95	822.60	1,233.90	1,645.20	2,056.50	2,879.00	4,113.00	8,226.00
NICs	15.61	25.89	36.17	41.54	41.54	41.54	41.54	41.54	41.54	41.54	41.54
Income tax	21.76	45.41	69.06	122.69	204.95	369.47	533.99	698.51	1,027.55	1,521.11	3,166.31
VAT		17.47	23.94	37.71
Other indirect taxes		27.10	32.20	43.06
Total excluding council tax		115.87	161.37	245.01
Real take-home pay (1996–97 prices)	164.21	231.44	298.66	441.77	562.17	802.98	1,043.79	1,284.60	1,766.23	2,488.66	4,896.77
Increase since 1991– 92	9.41	15.01	20.59	29.90	28.15	44.84	61.53	78.22	111.61	161.68	328.59

198W 199W

Income tax, national insurance and indirect taxes at multiples of average earnings 1997–98	Percentage of male average earnings
	50	75	100	150	200	300	400	500	700	1,000	2,000
Increase since 1996–97	3.27	5.25	7.21	10.85	12.60	16.11	19.62	23.13	30.16	40.69	75.80
Percentage of earnings
NICs	7.6	8.4	8.8	6.7	5.0	3.4	2.5	2.0	1.4	1.0	0.5
Income tax	10.6	14.7	16.8	19.9	24.9	29.9	32.5	34.0	35.7	37.0	38.5
VAT		5.7	5.8	6.1
Other indirect taxes		8.8	7.8	7.0
Total excluding council tax		37.6	39.2	39.7
Married couple one earner: 2 children
£ per week
Gross income	205.65	308.48	411.30	616.95	822.60	1,233.90	1,645.20	2,056.50	2.879.10	4,113.00	8,226.00
NICs	15.61	25.89	36.17	41.54	41.54	41.54	41.54	41.54	41.54	41.54	41.54
Income tax (less child benefit)	1.71	25.36	49.01	102.64	184.90	349.42	513.94	678.46	1,007.50	1,501.06	3,146.26
VAT		17.41	23.26	35.72
Other indirect taxes		31.92	35.73	43.84
Total excluding council tax		100.58	144.17	223.75
Real take-home pay (1996–97 prices)	183.78	251.00	318.23	461.33	581.74	822.55	1,063.36	1,304.17	1,785.79	2,508.22	4,916.33
Increase since 1991– 92	10.65	16.24	21.83	31.13	29.40	46.09	62.78	79.47	112.85	162.91	329.82
Increase since 1996– 97	3.24	5.21	7.18	10.81	12.57	16.08	19.59	23.10	30.12	40.65	75.76
Percentage of earnings
NICs	7.6	8.4	8.8	6.7	5.0	3.4	2.5	2.0	1.4	1.0	0.5
Income tax (less child benefit)	0.8	8.2	11.9	16.6	22.5	28.3	31.2	33.0	35.0	36.5	38.2
VAT		5.6	5.7	5.8
Other indirect taxes		10.3	8.7	7.1
Total excluding council tax		32.6	35.1	36.3
Married couple, 2 earners, no children:
Earnings split 60:-40
£ per week
Gross income	205.65	308.48	411.30	616.95	822.60	1,233.90	1,645.20	2,056.50	2,879.10	4,113.00	8,226.00
NICs	10.65	20.93	31.21	51.78	69.48	83.08	83.08	83.08	83.08	83.08	83.08
Income tax	4.74	26.15	48.81	96.11	143.41	265.31	415.19	579.71	908.75	1,402.31	3,047.51
VAT		18.78	25.24	37.99
Other indirect taxes		31.06	37.64	50.62
Total excluding council tax		96.92	142.90	236.49
Real take-home pay (1996–97 prices)	185.67	255.07	323.27	457.72	594.96	864.09	1,119.19	1,360.00	1,841.62	2,564.06	4,972.16
Increase since 1991– 92	8.73	16.50	23.06	34.25	47.77	56.46	66.19	82.88	116.26	166.34	333.23
Increase since 1996– 97	3.36	4.77	6.56	10.50	15.26	21.53	25.22	28.73	35.75	46.29	81.39
Percentage of earnings
NICs	5.2	6.8	7.6	8.4	8.4	6.7	5.0	4.0	2.9	2.0	1.0
Income tax	2.3	8.5	11.9	15.6	17.4	21.5	25.2	28.2	31.6	34.1	37.0
VAT		6.1	6.1	6.2
Other indirect taxes		10.1	9.2	8.2
Total excluding council tax		31.4	34.7	38.3

Income tax, national insurance and indirect taxes at multiples of average earnings	1991–92 indexed to 1997–98
	Percentage of male average earnings
	50	75	100	150	200	300	400	500	700	100	2000
Single person
£ per week
Gross income	205.65	308.48	411.30	616.95	822.60	1233.90	1645.20	2056.50	2879.10	4113.00	8226.00
NICs	14.17	23.42	32.68	37.51	37.51	37.51	37.51	37.51	37.51	37.51	37.51
Income tax	32.64	58.34	84.05	135.68	217.94	382.46	546.98	711.50	1040.54	1534.10	3179.30
Percentage of earnings
NICs	6.9	7.6	7.9	6.1	4.6	3.0	2.3	1.8	1.3	0.9	0.5
Income tax	15.9	18.9	20.4	22.0	26.5	31.0	33.2	34.6	36.1	37.3	38.6
Married couple, one earner: no children
£ per week
Gross income	205.65	308.45	411.30	616.95	822.60	1233.90	1645.20	2056.50	2879.10	4113.00	8226.00
NICs	14.17	23.42	32.68	37.51	37.51	37.51	37.51	37.51	37.51	37.51	37.51
Income tax	22.83	48.54	74.24	125.66	202.25	366.77	531.29	695.81	1024.85	1518.41	3163.61

200W 201W

Income tax, national insurance and indirect taxes at multiples of average earnings	1991–92 indexed to 1997–98
	Percentage of male average earnings
	50	75	100	150	200	300	400	500	700	100	2000
Percentage of earnings
NICs	6.9	7.6	7.9	6.1	4.6	3.0	2.3	1.8	1.3	0.9	0.5
Income tax	11.1	15.7	18.1	20.4	24.6	29.7	32.3	33.8	35.6	36.9	38.5
Married couple, one earner: 2 children
£ per week
Gross income	205.65	308.48	411.30	616.95	822.60	1233.90	1645.20	2056.30	2879.10	4113.00	8226.00
NICs	14.17	23.42	32.68	37.51	37.51	37.51	37.51	37.51	37.51	37.51	37.51
Income tax (less child benefit)	2.78	28.49	54.19	105.61	182.20	346.72	511.24	675.76	1004.80	1498.36	3143.56
Percentage of earnings
NICs	6.9	7.6	7.9	6.1	4.6	3.0	2.3	1.8	1.3	0.9	0.5
Income tax (less child benefit)	1.4	9.2	13.2	17.1	22.1	28.1	31.1	32.9	34.9	36.4	38.2
Married couple, 2 earners, no children:
Earnings split 60:40
£ per week
Gross income	205.65	308.48	411.30	616.95	822.60	1233.90	1645.20	2056.50	2879.10	4113.00	8226.00
NICs	9.83	19.08	28.34	46.85	62.78	75.02	75.02	75.02	75.02	75.02	75.02
Income tax	4.06	29.76	55.47	106.88	158.29	273.96	420.20	584.72	913.76	1407.32	3052.52
Percentage of earnings
NICs	4.8	6.2	6.9	7.6	7.6	6.1	4.6	3.6	2.6	1.8	0.9
Income tax	2.0	9.6	13.5	17.3	19.2	22.2	25.5	28.4	31.7	34.2	37.1

Notes to Tables:

1. Income tax payments are calculated on the assumption that the households receive no tax reliefs other than the standard allowances and only have income from employment. All earner, including wives are assumed to pay Class 1 National Insurance contributions at the contracted-in rate. Child benefit is deducted from income tax so as to provide comparability with figures for earlier years when support was partly given through child tax allowances.

2. Earnings are taken to be the average gross weekly earnings of all full-time males on adult rates with pay unaffected by absence. Estimates of earnings in 1996–97 and 1997–98 are based on earnings growth assumptions of 3 per cent. in 1996–97 and 4 per cent. in 1997–98 on line with the illustrative assumptions set out in the Financial Statement and Budget Report.

3. The figures for an indexed 1991–92 tax system show the tax payments that would result if the 1991–92 income tax system had been indexed to 1997–98 using the increase in the Retail Prices Index between December 1990 and September 1996, and income tax and national insurance contributions rates had been kept at their 1991–92 levels.

4. Real take-home pay includes earnings and child benefit less direct tax payments (income tax and national insurance contributions) deflated to 1996–97 prices using the Retail Prices Index. Indirect taxes and council tax are included in the Retail Prices Index and therefore in the inflation adjustment. Those on low earnings may be entitled to income-related benefits not included in these calculations.

5. Figures for indirect taxes include estimates of the effects of the main intermediate taxes on households as well as the impact of taxes on final goods and services. Estimates of the impact of taxes on final goods and services assume that these taxes are fully incident on households. Estimates of the impact of intermediate taxes are based on the relation between intermediate production costs and final consumption derived using input-output techniques.

6. Figures for indirect taxes and council tax are estimated from expenditure patterns in the 1994–95 Family Expenditure Survey uprated to later years using forecasts of aggregate tax receipts. All estimates are based on the illustrative assumption that 10 per cent. of disposable income is saved.

7. Estimates of indirect taxes are very approximate, even within the range for which figures are shown, because spending patterns vary widely between households with the same composition and income. The margin of error is even higher outside the range shown, and even illustrative estimates cannot be made. Because of sampling variation, there can be substantial differences between estimates obtained from Family Expenditure Surveys for different years, so reliable comparisons cannot be made between the estimates for different years.