Taxation: Income Tax

House of Lords written question – answered on 22nd November 2010.

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Photo of Lord Ashcroft Lord Ashcroft Conservative

To ask Her Majesty's Government what assessments they have made on the estimated tax receipts of a top rate of income tax of 40 per cent, 45 per cent and 50 per cent for each of the next five years.

Photo of Lord Sassoon Lord Sassoon The Commercial Secretary to the Treasury

The table below shows the June 2010 Budget forecast for total income tax receipts, including receipts expected at the additional rate of tax of 50 per cent (42.5 per cent for dividend income).

The table also shows the estimated total income tax receipts where the additional rate of tax is reduced to 45 and 40 per cent (37.5 and 32.5 per cent for dividend income). These estimates take account of initial assessments of possible behavioural responses if rates were changed.

Total income tax receipts1 (£ billion)
Additional rate of tax2 2011-12 2012-13 2013-14 2014-15 2015-16
50 per cent3 156.3 167.6 181.4 195.2 208.5
45 per cent 155.8 166.5 180.3 194.0 207.2
40 per cent 155.2 164.8 178.8 192.3 205.3

1. Gross of tax credits.

2. Table shows additional rate of tax on total income (excluding dividends income); additional rates of tax on dividend income are 42.5, 37.5 and 32.5 per cent respectively).

3. See Budget 2010 table C11.

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