§ Mr. Ralph Howell
asked the Prime Minister what would be (a) the loss of revenue if tax thresholds were raised to £3,000 per year for a single person and £6,000 a year for a married couple and (b) the saving in expenditure if child benefit were abolished; and if she will estimate the financial effect on a man with a wife and two children whose income was £100 per week of (i) each of the above changes and (ii) the introduction of both changes simultaneously.
§ The Prime Minister
The cost of raising tax thresholds to the levels specified would be about £12 billion in a full year, at 1984–85 levels of income and allowances. The public expenditure cost of child benefit at the current rate of £6.86 per child per week is about £4,430 million in a full year, on the basis of the number of beneficiaries in 1984–85. A married couple with gross income of £100 per week, where the wife was not working, would pay £613.50 less tax than under the 1984–85 tax regime. They would lose £13.70 per week—£712.40 in a year—from the abolition of child benefit. If the two changes were introduced simultaneously, they would lose £98.90 in a full year.