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Mr. Booth
To ask the Chancellor of the Exchequer what savings would accrue to the Treasury if M IRAS was phased out in three equal stages in three years.
Mr. Dorrell
The cost of mortgage interest tax relief at the proposed rate of 20 per cent. for 1994–95 is estimated to be £3·6 billion. Based on the estimated 1994–95 distribution of mortgages, if the relief were phased out in equal stages over a three-year period the estimated yield would be £1·2 billion, £2·4 billion and £3·6 billion.
These estimates adopt the conventional assumption that there will be no change in interest rates from the current rate of 8 per cent.