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Taxes
Mr. Maclean: To ask the Chancellor of the Exchequer using the assumptions underpinning the calculations made in the 1996 Budget, if he will calculate the (a) direct taxes and (b) indirect taxes paid by the average family in the UK as a result of (i) the 1997 Budget, (ii) the 1998 Budget and (c) the 1999 Budget. [111927]
Dawn Primarolo: For estimates of direct taxes paid by the average family I refer the right hon. Member to the answer I gave the hon. Member for Truro and St Austell (Mr. Taylor) on 25 January 2000, Official Report, columns 214-15W.
Estimating the impact of indirect taxes is imprecise as spending patterns vary widely between households with the same composition and income, with the consumption of the majority of goods and services far from universal. For example, only around one third of adults are smokers, just over half the adult population are in households paying vehicle excise duty and around 10 per cent. of households pay air passenger duty. This can be contrasted with direct taxes and benefits where at specified earnings and for particular household types there is a known benefit entitlement or tax liability.
Mr. Matthew Taylor:
To ask the Chancellor of the Exchequer, pursuant to his answer of 25 January 2000, Official Report, columns 214-15W, on taxes, what proportion of households are a one-earner married couple, with two children, on male median earnings; what proportion of earners earn within five per cent. of male median earnings; what proportion of households comprise a one-earner couple with two children; and if he will recalculate his answer to apply to a two-earner household where both earners are employed, one on male median earnings and one on female median earnings, with two children. [110213]
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Dawn Primarolo
[holding answer 16 February 2000]: According to the Family Expenditure Survey 1995-96 to 1997-98, 12.6 per cent. of households are one-earner couples with 2 children. The proportion of these couples who are married is not readily available.
| Year | Percentage |
|---|---|
| 1983-84 | 24.0 |
| 1984-85 | 23.5 |
| 1985-86 | 23.4 |
| 1986-87 | 23.1 |
| 1987-88 | 22.5 |
| 1988-89 | 21.7 |
| 1989-90 | 21.5 |
| 1990-91 | 21.2 |
| 1991-92 | 21.1 |
| 1992-93 | 20.4 |
| 1993-94 | 20.5 |
| 1994-95 | 21.8 |
| 1995-96 | 22.2 |
| 1996-97 | 21.4 |
| 1997-98 | 20.8 |
| 1998-99 | 20.8 |
| 1999-00 | 20.2 |
| 2000-01 | 20.1 |
| 2001-02 | 18.9 |
Notes:
1. Direct taxes are defined as Income Tax plus National Insurance minus Child Benefit. In line with long-standing convention, Child Benefit is treated as a negative component of Income Tax, making it consistent with child tax allowances prior to 1976.
2. Earnings are taken to be median weekly earnings of full-time employees on adult rates with pay unaffected by absence form the New Earning Survey. Median earnings on a consistent basis are not available before 1983.
By 2001 the tax burden for the 2 earner married couple both on average earnings with 2 children will be below 20 per cent. for the first time ever.
Agriculture (Fuel Tax)
Mr. Wigley: To ask the Chancellor of the Exchequer how much tax per litre of diesel, used for agricultural purposes, was charged in each of the member states of the EU, including all duties and sales taxes in the last financial year for which figures are available. [111790]
Mr. Timms: The rate of excise duty on diesel for agricultural purposes in the United Kingdom is 3.03 pence per litre. Diesel for agricultural purposes is liable to VAT at 17.5 per cent. of the retail price.
Information on the rates of tax on diesel for agricultural purposes in the other member states of the EU is not available.
Wales (Earnings)
Mr. Wigley:
To ask the Chancellor of the Exchequer how many people in Wales earn (a) £3.60 per hour,
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(b) £3.61 to £3.80 per hour, (c) £3.81 to £4.00 per hour and (d) £4.00 to £4.50 per hour; and what percentage of total employees this constitutes in each case. [111682]
Miss Melanie Johnson:
The information requested falls within the responsibility of the Director of the Office for National Statistics. I have asked him to reply.
Letter from Tim Holt to Mr. Dafydd Wigley, dated 28 February 2000:
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As the Director of the Office for National Statistics (ONS), I have been asked to reply to your recent question regarding earnings for employees in Wales.
The New Earnings Survey (NES) can provide earnings data for geographical areas. However, the release of NES data is restricted to figures which are derived from a sufficiently large sample of employees and have an acceptable level of accuracy. I have provided information for Wales in the attached table. These are based on the 1999 NES, the latest survey for which data are available.
We are only able to give percentages earning below specified thresholds, rather than numbers because appropriate grossing factors for the NES sample are not available.
The NES is based on a one per cent. sample of employees in the PAYE system and is therefore likely to under-represent relatively low paid staff earning below the tax threshold and in particular those who work part-time.
| Gross hourly earnings excluding overtime (£) | ||||
|---|---|---|---|---|
| £3.60 | £3.61-£3.80 | £3.81-£4.00 | £4.01-£4.50 | |
| Wales | ||||
| Full-time | 0.8 | 1.4 | 1.9 | 5.6 |
| Part-time | 5.6 | 6.6 | 7.3 | 14.2 |
| All | 1.9 | 2.6 | 3.1 | 7.6 |
Source:
New Earnings Survey, April 1999 (GB)
Fiscal Changes
Mr. Edwards: To ask the Chancellor of the Exchequer if he will estimate the impact on revenue to the Exchequer in the financial year 2000-01 of (a) abolishing the upper earnings limit on employee national insurance contributions, (b) introducing a 50 per cent. rate of income tax for taxable income over £100,000 per year, (c) extending the 10 per cent. income tax band to £7,115 per year of gross income for (i) all taxpayers and (ii) taxpayers other than higher rate taxpayers and (d) raising the rate of the national minimum wage for adults to £4.94 per hour. [111643]
Dawn Primarolo:
The estimated full-year tax and National Insurance Contribution effects for 2000-01 are in the table.
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| 2000-01 full-year effects (56), (57) | |
|---|---|
| Abolishing the upper earnings limit on employee national insurance contributions(58) | +3.2 |
| Introducing a 50 per cent. rate of income tax for taxable income over £100,000 per year(59) | +2.6 |
| Extending the starting rate band to £2,730 for all taxpayers (59), (60) | -3.5 |
| Extending the starting rate limit to £2,730 for taxpayers other than higher rate taxpayers (59), (60) | -3.1 |
| Raising the rate of the national minimum wage for adults to £4.94 per hour | (61)-- |
(56) All estimates are consistent with the November 1999 pre-Budget report.
(57) Includes the effects on Working Families Tax Credit and Disabled Persons' Tax Credit.
(58) The NIC effect was produced by the Government Actuary's Department.
(59) The income tax estimates are based on the 1997-98 Survey of Personal Incomes.
(60) £2,730 is the difference between £7,115 and the non-aged personal allowance of £4,385.
(61) It is not possible to give an estimate of the impact on Exchequer revenue of increasing the National Minimum Wage to £4.94 per hour. Such a move could have significant adverse effects on the employment of low-skilled workers. Therefore any Exchequer gains through increased tax revenue could to some extent be offset by increases in benefit payments.
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Income Tax
Miss McIntosh: To ask the Chancellor of the Exchequer if he will review his decision to reduce income tax by one penny. [111378]
Dawn Primarolo: My right hon. Friend the Chancellor announced in his 1999 Budget statement that the basic rate of income tax will fall to 22p in the pound from April 2000.
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