asked the Minister for Finance the average amount of income tax paid by (a) PAYE workers (b) farmers and (c) the self-employed, in each of the past five years.
Written Answers. - Income Tax Yield.
86.
Following is the information requested:
|
Year |
Average tax payment made by |
||
|
(a) |
(b) |
(c) |
|
|
PAYE |
Farmers |
Other self-employed |
|
|
£ |
£ |
£ |
|
|
1983 |
1,911 |
705 |
1,510 |
|
1984 |
2,289 |
703 |
1,792 |
|
1985 |
2,457 |
672 |
1,958 |
|
1986 |
2,697* |
593* |
2,124* |
|
1987 |
2,920* |
585* |
2,526* |
*Provisional — subject to revision.
Notes
Column (a)
(i) Income tax collected through the PAYE mechanism covers more than income tax on ordinary wages and salaries. It includes tax paid by directors of close companies who are akin to the self-employed as well at tax on "other income" of employees such as rent and other investment income.
(ii) The average tax payment for each year is obtained by dividing the net receipt of PAYE tax in each calendar year by the number of taxpaying units effectively liable to tax in the income tax year in which the calendar year ends e.g. the 1983 net receipt is divided by the number liable to tax in 1983-84.
Column (b)
(i) In calculating the figures in this column the estimated net receipt from farm taxation in each calendar year has been divided by the number of farming tax units assessed to tax on their farming profits in the year of assessment in which the calender year ends e.g. the 1983 receipt is divided by the number assessed for the year 1983-84, irrespective of whether or not the assessed tax was actually payable.
(ii) The reduction in the average tax payments made by farmers over the years in question is mainly due to the introduction of additional numbers of farmers to tax records since 1983-84 consequent on the abolition of the rateable valuation threshold. It follows that the new cases, in general, had much smaller holdings and consequently had, on average, lower taxable incomes. Another factor affecting the level of tax per case was the effects of reduced profit levels resulting from disadvantageous weather conditions in 1985 and 1986.
(iii) Full-time farmers and farmers who, or whose spouses, carry on another trade or profession have been included in the calculations.
(iv) Income tax on farming profits is collected with Schedule D tax generally and because of this it cannot be separately distinguished. Accordingly the figures shown for tax payments by farmers are estimated.
Column (c)
(i) The figures contained in this column are obtained by dividing the estimated net receipt of income tax from other self-employed tax units in each calendar year by the estimated number of those units assessed to tax in the year of assessment in which the calendar year ends as explained in note (i) for column (b).
Columns (a), (b) and (c)
(i) A married couple who have elected or have been deemed to have elected to have the income of both spouses assessed on the husband is counted as one tax unit.
(ii) Some figures in the columns differ from those given previously. This is due to more accurate information becoming available in the meantime.