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Income Tax

Volume 974: debated on Tuesday 27 November 1979

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asked the Chancellor of the Exchequer what percentage of the income of a married man, with two children, on average earnings is taken by income tax; and what are the equivalent figures for the other EEC countries, the USA and Japan.

Information on average earnings in the other EEC countries,

Average production worker's wage in £ sterlingIncome tax in £ sterlingPercentage of income paid in income tax
United Kingdom5,16796818·7
Belgium6,68080712·1
France5,4171031·9
Germany8,40595611·4
Ireland5,09073014·3
Italy4,13641610·1
Netherlands7,9051,10113·9
USA6,5275127·8
Japan6,9612203·2
Notes
1. Figures for the other EEC countries, the USA and Japan and United Kingdom Treasury estimates of APW wage levels as at 1 October 1979, based on OECD figures for 1978 earnings of an average production worker—estimates for Denmark and Luxembourg are not available. The United Kingdom figure is an estimate of the average wage of a male manual worker in manufacturing industry for September 1979, but this figure may be abnormally low because of the effect of the engineering dispute.
2. Currency conversions have been made at the exchange rates prevailing on 19 November 1979. The exchange rates between the United Kingdom and overseas countries may not fully reflect differences in consumer's purchasing power between the United Kingdom and those countries.
3. The tax figure is income tax only and does not include Social Security contributions. In computing tax liabilities, account has been taken of personal allowances and reliefs, employment income reliefs, minimum deductions for expenses, allowances for social security contributions and any other flat rate reliefs against employment income.
4. All income is assumed to be employment income of the husband.
5. All figures relate to the tax year 1979 or 1979–80, except for France—1978—whose income tax rates are fixed in arrear.
6. The United Kingdom completed its move from child tax allowances to child benefits with effect from 6 April 1979. Income from child benefits and analogous payment overseas has not been taken into account in any of these calculations.