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Tax Thresholds

Volume 979: debated on Tuesday 26 February 1980

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asked the Chancellor of the Exchequer what the tax expenditure saving would be in 1979–80, and by what percentage could tax thresholds, including child benefits, have been raised as a result of those savings, if all the present adult tax allowances were replaced by a single uniform fixed-amount tax deduction worth 30 per cent. of £900 for every adult, regardless of marital status, but which married couples could aggregate against the income of either spouse.

If the present tax allowances were replaced by a fixed amount tax deduction of £270 for each adult, it is estimated that at 1979–80 income levels there would be a yield of the order of £3,300 million from the present population of taxpayers. There would be an additional yield from those at present not within the population of taxpayers, but the information with which to estimate the amount of this is not available. I regret it is not clear what further information my hon. Friend requires, but £3,300 million would allow an increase of about 29 per cent. on the allowance of £900 and on child benefit.