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Capital Gains

Volume 116: debated on Monday 11 May 1987

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asked the Chancellor of the Exchequer what effect he estimates the raising of capital gains will have on (a) life insurance policies and (b) mortgages linked to house policies; and what amount he estimates will be lost in basic payments.

[pursuant to his reply, 6 May 1987]: The new arrangements proposed for the taxation of companies' capital gains should generally have only a relatively marginal effect on post-tax profits reserved for holders of life assurance policies, including those with endowment-linked mortgages. The level of benefits and bonuses allocated to policyholders is however entirely a matter for life assurance companies themselves to determine.