§ Mr. MilburnTo ask the Chancellor of the Exchequer what the cost would be of reducing the starting rate of tax to(a) five per cent. and (b) nought per cent.for those earning less per annum that (i) £5,000, (ii) £10,000, (iii) £15,000, (iv) £20,000, (v) £25,000 and (vi) £30,500 assuming that the starting rate continues to apply to the first £1,960 of taxable income. [133177]
§ Dawn Primarolo[holding answer 29 November 2003]: Estimates are given in the table.
Cost of reducing the starting rate of tax1 (in £ billion) Starting rate in 2003–04 (a) Five per cent. (b) nought per cent. Total income per annum less than: (i) £5,000 Negligible Negligible (ii) £10,000 0.6 1.1 (iii) £15,000 1.2 2.4 (iv) £20,000 1.7 3.3 (v) £23,000 2.0 4.1 (vi) £30,500 2.3 4.6 1 Excludes dividends income at the starting rate The estimates are based on the Survey of Personal Incomes 2000–01 and are consistent with the April 2003 Budget.
The figures exclude any estimates of behavioural response to the change.