To ask the Chancellor of the Exchequer pursuant to the answer to the hon. Member for South Holland and The Deepings (Mr. Hayes) of 30 November 2006, Official Report, column 838W, on party political funding, whether funds donated from councillors’ allowances direct from the council payroll to (a) a political party and (b) a political group of the council are (i) tax deductible and (ii) liable for income tax and National Insurance. (119795)

Party political donations paid either to a political party or political group are not tax deductible and the councillor’s allowance would be liable for income tax and national insurance in the normal way.