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Treasury

Answer

Mr. Flight: To ask the Chancellor of the Exchequer with reference to (a) the tax credits figures in the third row of Table C8 of the 2003 Budget, HC 500, (b) the tax credits figures in the thirty-third row of Table C8 of the 2003 Budget, HC 500, (c) the social security benefits figures in the fifth row of Table C11 of the 2003 Budget, HC 500 and (d) the tax credits figures in the sixth row of Table C11 of the 2003 Budget, HC 500, if he will list the types of tax credit, benefits payment and other components which comprise the quoted figures; for each type of tax credit, benefit payment and other component, whether, according to the accounting methods employed in the 2003 Budget, they are classified as negative tax revenues, Government spending or a combination of the two; and for each tax credit, benefit payment and other component, what amount of tax was refunded and Government spending was incurred in each year since 2001-02 to the latest year for which figures are projected. [121327] Dawn Primarolo: The treatment of personal tax credits in Budget reports was explained in Box C2 on page 216 of Budget 2002 (HC592). The Government have adopted best international practice as set out in OECD guidelines for the purposes of calculating net taxes and social security contributions as included in Table C8 of Budget 2003. However there are some differences between the OECD guidelines and National Accounts basis used for calculation of other fiscal aggregates. (a) Row 3 of Table C8 (tax credits scoring as negative tax under OECD guidelines) includes: Children's Tax Credit; Working Families' Tax Credit (WFTC)--part; Disabled Person's Tax Credit (DPTC)--part; Child Tax Credit--part; Working tax credit--part; Life assurance premium relief at source (LAPRAS)--part; and Enhanced company tax credits for research and development and contaminated land clearance that reduce corporation tax liability. (b) Row 33 of Table C8 (OECD negative tax but public expenditure in national accounts) includes parts of WFTC, DPTC and LAPRAS, and all reduced liability corporation tax credits for research and development and contaminated land clearance. (c) Row 5 of Table C11 (Social Security benefit expenditure) includes II social security benefits except child allowances in Income Support and Jobseekers' Allowance, and all child benefit and war pensions. (d) Row 6 of Table C11 includes: Parts of Child Tax Credit, Working tax credit, WFTC, DPTC and Child allowances in Income Support and Jobseekers' Allowance, (paid as part of the Child Tax Credit from 2003-04 and included here to give consistent figures over the period of table); LAPRAS; Charities transitional relief; and Tax relief on contributions to personal and stakeholder pensions made by non-taxpayers. The following table shows the available figures on tax credits. More detailed information on outturn for individual tax credits available on www.inlandrevenue. gov.uk/stats. Details of social security benefit expenditure are available on www.dwp.gov.uk/asd/asd4/expenditure. htm. £ billion _________________________________________________________________________________________________. Category 2001-02 2002-03 2003-04 (a) C8 row 3, negative tax (OECD) -2.3 -3.4 -4.5 Of which: Personal tax credits1 -2.2 -3.1 -3.9 Corporation tax credits -0.1 -0.2 -0.5 Other -0.1 -0.1 -0.1 (b) C8 row 33, negative tax 0.9 1.1 0.6 (OECD) but spending in National Accounts Of which: Personal tax credits1 0.7 0.8 0.0 Corporation tax credits 0.1 0.2 0.5 Other 0.1 0.1 0.1 (d) C11 line 6, public 8.7 9.8 11.7 expenditure Of which: Personal tax credits1 4.8 5.6 8.0 IS / JSA child allowances 3.6 4.0 3.5 Other 0.2 0.2 0.2 _________________________________________________________________________________________________. 1 Includes the relevant elements of WPTC, DPTC, Child Tax Credit and Working Tax Credit and Children's Tax Credit.

Secondary information

Type

Written question

Reference

121327; 408 c378-9W

Session

2002-03

Subjects

Statistics Welfare tax credits Budget April 2003

Contains statistics

Yes

Link

View this Written question on www.publications.parliament.uk