Income Tax

Wales written question – answered on 4th July 2012.

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Photo of Owen Smith Owen Smith Shadow Secretary of State for Wales

To ask the Secretary of State for Wales

(1) what proportion of workers in Wales will pay a reduced level of income tax as a result of the reduction in the additional rate;

(2) what discussions she has had with ministerial colleagues on the effect in Wales of the decision to reduce the additional rate of income tax;

(3) what assessment she has had made of the effect of reducing the additional rate of income tax on the Welsh economy.

Photo of Dame Cheryl Gillan Dame Cheryl Gillan The Secretary of State for Wales

I have regular discussions with ministerial colleagues on a range of issues affecting taxpayers in Wales including the decision to reduce the additional rate of income tax.

Projections of the number of higher and additional rate taxpayers for Wales up to 2012-13 are published on the HMRC website in table 2.2 at:

http://www.hmrc.gov.uk/stats/income_tax/menu.htm

These figures show that there are an estimated 5,000 additional rate income taxpayers in Wales in 2012-13.

Introducing the additional rate of income tax is estimated to have reduced the UK GDP by between 0.2 and 0.3%. No assessment has yet been made on a sub-national level.

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