asked the Minister for Finance if he will state in respect of the years 1983, 1984 and 1985, the cost to the Exchequer in terms of tax foregone of: (a) section 84 loans; (b) capital allowances on leased assets; (c) capital allowances on assets, other than leased assets; (d) reduced rate of tax on manufacturing profits; and (e) reduced rate of tax on profits below £35,000.
Written Answers. - Tax Relief.
265.
The following table sets out the information requested in so far as it is available:—
|
Allowance or relief |
Estimated cost to the Exchequer |
||
|
1983 |
1984 |
1985 |
|
|
£ million |
£ million |
£ million |
|
|
(a) “Section 84” loans¹ |
73.0 |
86.0 |
100.2 (provisional) |
|
(b) Capital allowances on leased assets |
72.0 (1983-84) |
72.5 (1984-85) |
65.0 (provisional) (1985-86) |
|
(c) Capital allowances on other assets† |
146.2 (1983-84) |
171.5 (1984-85) |
220.0 (provisional) (1985-86) |
|
(d) Manufacturing profits — reduced rate of tax† |
90.1†† |
95.8†† |
111.3 (provisional) †† |
|
(e) Profits below £35,000 — reduced rate of tax† |
7.5 |
7.3 |
7.6 (provisional) |
¹ Includes preference share financing which is a minor element of the total.
†These estimates are very tentative and are subject to a wide margin of error.
††These figures represent the estimated loss to the Exchequer arising from the charging of manufacturing and other qualifying profits at reduced rates of corporation tax instead of at normal rates.
General Note
The estimates given in the table in respect of capital allowances are available only in respect of years ended 5 April e.g. the 1983-84 cost is that relating to the year ended 5 April, 1984.