Income Tax

Lord Haskel Excerpts

Wednesday 19th November 2014 Lords Chamber

[Lord Newby]

My Lords, the impact of the reduction in the 50p tax rate was about £100 million, when all the secondary effects were taken into account. In respect of capital gains tax, I will need to write to the noble Lord.

[Lord Haskel (Lab)]

Did the Minister see the research recently which said that paying a living wage encouraged people to be more productive and raised the level of income tax? Why do the Government not just do it?

[Lord Newby]

My Lords, paying the living wage is something that the Government support but, as we have discussed before in your Lordships’ House, there is a balance between rising wages and unemployment. That is the basis on which the minimum wage is set. I gave an example from the Dispatch Box the last time we discussed this: having spoken to people working in the textile industry in Leicester, they demonstrated to me that a big increase in the wage that they were paid would mean that fewer of them would be earning it, because they would be out of the job.