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EU Taxation Policy Group

Mr. Portillo: To ask the Chancellor of the Exchequer if he will publish the remit of the European Union's Taxation Policy Group. [114226]

Dawn Primarolo [holding answer 14 March 2000]: The Taxation Policy Group was established following the Dublin European Council in December 1996 which noted the ECOFIN Council conclusions of November 1996. These conclusions welcomed a proposal for a group made up of member states and the Commission as set out in "Taxation in the European Union--Report on the Development of Tax Systems" of October 1996 (Com(96)546).

The Taxation Policy Group has no power to take decisions. EU tax decisions are a matter for member states, acting by unanimity, within the Council.

Mr. Portillo: To ask the Chancellor of the Exchequer what position was taken by Her Majesty's Government on (a) improving the VAT system in the internal market and (b) company taxation in the European Community, at the meeting of the European Union's Taxation Policy Group on 2 March. [114228]

Dawn Primarolo [holding answer 14 March 2000]: The UK position at the meeting was wholly consistent with our public statements.

Mr. Portillo: To ask the Chancellor of the Exchequer if he will publish the agendas and minutes of the meetings of the EU Taxation Policy Group which have taken place to date. [114227]

Dawn Primarolo [holding answer 14 March 2000]: It has not normally been the Commission's practice to issue minutes. I will ensure that the agendas of Taxation Policy Group meetings are placed in the Library of the House.

Mr. Portillo: To ask the Chancellor of the Exchequer who attends meetings of the European Union's Taxation Policy Group on behalf of Her Majesty's Government. [114225]

Dawn Primarolo [holding answer 14 March 2000]: I am the Government's lead representative on the Taxation Policy Group. If I am unable to attend, senior officials may attend on my behalf.

National Insurance Recording System

Mr. Russell Brown: To ask the Chancellor of the Exchequer if his Department plans to seek compensation from Andersen Consulting as a result of the delays to the new National Insurance Recording System. [115218]

Dawn Primarolo: My conclusion is that it would not be sensible or cost effective to seek further compensation from Andersen Consulting beyond the agreed amount of £4.1 million which was paid for delays in 1997 and 1998. This also involved Andersen Consulting in additional, unrecoverable development costs of £20 million.

In reaching this decision I have taken into account not just the contractual and legal position, but also the further investment made by Andersen Consulting beyond the development costs of some £7 million, at no cost to the Government, to ensure that the system is fully functional. Beyond this, I am satisfied that taking action against Andersen Consulting would prejudice the partnership

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relationship now established between it and the Inland Revenue. This is essential to the delivery of future changes to the system in support of the Governments National Insurance and Pensions and Welfare Reform proposals.

Wealth Statistics

Mr. Gordon Prentice: To ask the Chancellor of the Exchequer if he will estimate the total wealth of the richest (a) 1 per cent., (b) 5 per cent., (c) 10 per cent. and (d) 50 per cent. of the United Kingdom population; and in each case what proportion of the United Kingdom total this represents. [113894]

Dawn Primarolo: The figures are shown in the table:

Distribution of marketable wealth 1996 (3)

Wealth £ billionPercentage
Top 1 per cent. of adult population40019
Top 5 per cent. of adult population80039
Top 10 per cent. of adult population1,10052
Top 50 per cent. of adult population1,95093
Entire adult population2,100100

(3) Provisional


Tax Allowances

Mr. Ottaway: To ask the Chancellor of the Exchequer what estimate he has made of the full year cost from April 2000 of transferring an unused personal tax allowance from a married person to their earning spouse where (a) there are no children and (b) where that person's youngest child is (i) aged under five, (ii) under 11 and (iii) under 16 years at the beginning of the tax year. [113478]

Dawn Primarolo: The estimated costs for 2000-01 of allowing a married person to transfer an unused personal tax allowance to their earning spouse are given in the table.

Family type£ million
(a) Married couples with dependant children600
Married couples whose youngest child is:
(b)(i) under the age of 5850
(b)(ii) under the age of 111,200
(b)(iii) under the age of 161,350

E-commerce

Mr. Denzil Davies: To ask the Chancellor of the Exchequer what estimate he has made of the erosion of revenue from VAT as a result of the increase in e-commerce. [114568]

Dawn Primarolo: Although accurate figures are not available, the VAT currently at risk is not considered to be significant. However, we will continue to monitor this area closely.

IR35

Miss Geraldine Smith: To ask the Chancellor of the Exchequer what estimate he has made of the increased cost to United Kingdom businesses resulting from the introduction of IR35. [114500]

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Dawn Primarolo: Such estimates were made for the Welfare Reform and Pensions Bill in the "Regulatory Impact Assessment for National Insurance Service Provision Through Intermediaries", which was published in October 1999.

Miss Geraldine Smith: To ask the Chancellor of the Exchequer what the estimated tax receipts flowing from the introduction of IR35 are for the next financial year. [114503]

Dawn Primarolo: Estimates of the expected revenue consequences from the proposed measure to stop avoidance of tax and National Insurance Contributions using personal service companies were included in the Financial Statement and Budget Report (FSBR) which was published on Budget Day in March 1999.

Miss Geraldine Smith: To ask the Chancellor of the Exchequer what estimate he has made of the possible loss of revenue resulting from people leaving the United Kingdom following the introduction of IR35. [114499]

Dawn Primarolo: Information on our assumptions about the effects of the introduction of IR35 was included in the Regulatory Impact Assessment on the Welfare Reform and Pensions Bill which was published in October 1999.

Miss Geraldine Smith: To ask the Chancellor of the Exchequer (1) if he will estimate the cost of the legislation introducing IR35; [114502]

Dawn Primarolo: This information is provided on pages 15 and 16 of the Regulatory Impact Assessment on the Welfare Reform and Pensions Bill published in October 1999.

NIRS2

Mr. Love: To ask the Chancellor of the Exchequer if he will report on progress in the introduction of the NIRS 2; and if he will make a statement. [114696]

Dawn Primarolo: The majority of the NIRS2 system facilities are working well and we are now seeing considerable improvements. The Inland Revenue National Insurance Contributions Office is using the system to reduce backlogs and improve service to the customer.

Remaining key elements will be in place in April 2000--this will mean that the Inland Revenue National Insurance Contributions Office can reduce backlogs of pension work which in turn will help the Benefits Agency clear benefits work.

Churches

Miss McIntosh: To ask the Chancellor of the Exchequer if he will take steps to implement the European directive allowing a reduced rate of VAT on specified labour-intensive work relating to churches. [114336]

Dawn Primarolo: The new EC Directive on reduced rate experiments for labour-intensive services is aimed at private dwellings, not churches.

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Basic State Pension

Ms Oona King: To ask the Chancellor of the Exchequer, pursuant to his answer of 19 January 2000, Official Report, column 502W, on the basic state pension, what would be the real increase in the yield of national insurance contributions between 1999-2000 and 2010-11 if the total yield rose in line with average earnings. [114198]

Dawn Primarolo: If total national insurance contributions receipts for Great Britain in 1999-2000 were increased in line with average earnings each year until 2010-11, then this figure would be some £11.7 billion higher than the 1999-2000 figure in real terms 1 .

This estimate was provided by the Government Actuary's Department.



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