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Income Tax And National Insurance

Volume 13: debated on Friday 27 November 1981

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asked the Chancellor of the Exchequer, if he will construct an index, with 1978–79 equals 100, of the changes in the level of income tax and national insurance contributions for each subsequent year for a taxpayer in (a) two thirds, (b) average, (c) five times average and (d) 10 times average earnings for households where the taxpayer is: (i) single, (ii) married, (iii) married with two children, (iv) married with four childen and in all cases assuming that the wife does not work.

[pursuant to his reply, 20 November 1981, c. 254]. The tables below show income tax and national insurance contributons as a percentage of gross earnings plus child benefit (where appropriate), with changes in those percentages shown in brackets in index number form, taking 1978–79 = 100. Earnings figures for 1981–82 as a whole are not yet available. The calculations assume that the taxpayer has no allowances or reliefs other than the appropriate personal allowances. National insurance contributions are at the no-contracted-out rate.

1

5

10

Married with no children

1978–7922·2(100·0)28·0(100·0)50·9(100·0)66·8(100·0)
1979–8021·4(96·4)26·4(94·3)41·8(82·1)50·9(76·2)
1980–8122·9(103·2)27·5(98·2)43·2(84·9)51·6(77·2)

Married with two children (both under 11)

1978–7918·6(100·0)25·2(100·0)49·7(100·0)66·1(100·0)
1979–8019·3(103·8)24·7(98·0)41·2(82·9)50·5(76·4)
1980–8120·9(112·4)25·8(102·4)42·7(85·9)51·3(77·6)

Married with four children (two under 11, one 11–15, one over 16)

1978–7914·7(100·0)22·2(100·0)48·3(100·0)65·2(100·0)
1979–8017·6(119·7)23·1(104·1)40·6(84·1)50·2(77·0)
1980–8119·2(130·6)24·4(109·9)42·1(87·2)51·0(78·2)
Earnings figures for financial years are derived from estimated average earnings for each month from April to the following March. The figures for April are derived from the New Earnings Survey and represent average gross weekly earnings of full-time adult male employees in all occupations (manual and non-manual). Figures or other months are obtained by updating the April figure, taking account of movements in the centred three-month moving average of the seasonally adjusted whole econnomy index for average earnings