§ Mr. Matthew Taylor
To ask the Chancellor of the Exchequer, pursuant to his answer of 28 July 2000,Official Report, column 1011W, on income tax, if he will estimate the level of personal income tax allowance if the 10 pence band was abolished at a cost of (a) £2.6 billion, (b) £3 billion and (c) £3.5 billion in a full year; and if he will make a statement. 264W
§ Dawn Primarolo
If the 10p band was abolished in 2000–01 and income tax personal allowances were increased, by the following amounts, then the revenue effects in a full-year are shown in the table:
Abolish the 10p rate and increase income tax personal allowances by: Revenue effect (£ billion) £1,520 -4.6 £1,340 -3.5 £1,260 -3.0 £1,190 -2.6
These estimates are based on the Survey of Personal Incomes and are consistent with the March 2000 Budget.
The revenue effects provided have not taken account of any consequential effects on the level of National Insurance contributions. All the figures shown are the estimated direct effects of tax changes on tax revenues. In practice, tax changes will themselves effect economic variables, which in turn will have further effects on tax revenues.