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Taxation

Volume 493: debated on Tuesday 2 June 2009

To ask the Chancellor of the Exchequer if he will make an estimate of the full-year cost to the Exchequer for (a) 2009-10, (b) 2010-11 and (c) 2011-12 of simultaneously reducing the starting and basic rate of tax on savings income to zero and increasing age-related personal allowances by £2,000. (254795)

The full year cost for each of the three years is shown in the table. The estimates are based on the 2006-07 Survey of Personal Incomes projected forward in line with Budget 2009 assumptions. The figures exclude any estimate of behavioural response

£ million

2009-10

2010-11

2011-12

Zero starting and basic rate of income tax on savings income and increase age related allowances by £2,000

1,710

2,850

3,800

To ask the Chancellor of the Exchequer what assistance his Department provides to individuals in financial difficulty; whether provision exists for individuals to delay payment of (a) income tax and (b) national insurance; what plans he has to provide further assistance to such individuals in the next 12 months; what representations he has received on this issue; and if he will make a statement. (276865)

With regard to tax collection, HM Revenue and Customs (HMRC) expects all customers to make payments when they are due. However, the Department recognises that in certain circumstances this may not be possible and publishes advice and guidance for individuals encountering payment difficulties. This guidance can be accessed at

http://www.hmrc.gov.uk/payinghmrc/problems/cantpay-individuals.htm.

In addition, individuals who run their own business can now access the new Business Payment Support Service (BPSS), which allows viable businesses in temporary financial difficulty time to pay their tax bills to a timetable they can afford. The service was extended at Budget 2009 to allow businesses expecting to make losses to offset these against tax bills due on profits from the previous year, which they are unable to pay. As of 24 May over 135,000 agreements had been reached with business, worth £2.4 billion of tax deferred.

The Government receive various representations relating to the collection of income tax and national insurance contributions, and keep the case for further assistance to individuals in financial difficulty under review.