Written question asked by David Anderson (Labour) on Friday, 13 April 2007, in the House of Commons. It was due for an answer on Tuesday, 17 April 2007. It was answered by Baroness Primarolo (Labour) on Monday, 23 April 2007 on behalf of the Treasury.

Income Tax: Tax Rates and Bands

Question: To ask the Chancellor of the Exchequer what assessment he has made of the impact of the removal of the 10 pence tax rate on the incomes of people aged (a) between 60 and 65 years and (b) 65 years and older.

Answer: The removal of the 10 pence tax rate was part of a package of reform announced in Budget 2007, which also included reducing the basic rate of income tax from 22p to 20p, increasing aged personal allowances, aligning the Upper Earnings Limit with (an increased) higher rate threshold and increases to the working tax credit and child tax credit.As a result of this package, we estimate that on average households including someone aged 60 to 64 will be over £27 a year better off in 2009-10, while households with someone aged 65 or more will be on average £72 a year better off (in 2007-08 prices).

Secondary information