Income Tax

Treasury written question – answered on 22nd February 2010.

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Photo of Hywel Williams Hywel Williams Shadow PC Spokesperson (Education), Shadow PC Spokesperson (Work and Pensions), Shadow PC Spokesperson (Health), Shadow PC Spokesperson (International Development)

To ask the Chancellor of the Exchequer what estimate his Department has made of the additional amount of revenue that would be raised in 2010-11 if the national insurance contribution ceiling was removed.

Photo of Stephen Timms Stephen Timms Parliamentary Under-Secretary (Department for Business, Innovation and Skills) (Digital Britain) (also HM Treasury), Financial Secretary (HM Treasury) (also in the Department for Business, Innovation and Skills)

holding answer 4 February 2010

The additional amount of revenue that would be raised from the removal of the upper earnings limit for employees paying Class 1 national insurance contributions and the upper profits limit for self employed individuals paying Class 4 contributions is estimated to be around £11 billion in 2010-11.

This figure excludes any estimate of behavioural effects which are likely to be significant given the scale of the change. The estimate is consistent with the 2009 pre-Budget report assumptions.

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