Direct Tax and National Insurance Contributions
Debate between Viscount Younger of Leckie and Lord Leigh of Hurley
Viscount Younger of Leckie (Con)
The noble Lord gives one example. As he knows, individuals can be subject to different tax treatments depending on the type of income they receive and whether they are employed or self-employed or working through a company structure. I reassure him that the Government have taken action to reduce this disparity in tax treatment, for example by reforming the taxation of dividend income, reforming the main rates of dividend tax in 2016 and reducing the tax-free dividend allowance from £5,000 to £2,000 from 2018.
Lord Leigh of Hurley (Con)
Will my noble friend join me in resisting any attempts to treat gains from capital at the same rate as income? People like me, called speculators by some, started up a new business with risk capital, which is easily lost, whereas others bank an income entirely risk-free; they should not be equated. It is worth reminding the House that a mobile 1% of taxpayers account for 30% of revenues.
Viscount Younger of Leckie (Con)
My noble friend makes a good point. The Government are committed to a fair tax system in which those with the most contribute the most, but one which also has to encourage saving. The income tax system, we believe, is highly progressive: the top 5% are projected to pay half of all income tax in 2022-23. My noble friend also cited the other statistic: the top 1% are projected to pay over—he said 30%—actually 28% of all income tax. Crucially, the top 10% of the income distribution are estimated to receive 35% of all income but pay over 60% of all income tax liabilities.
Council Tax
Debate between Viscount Younger of Leckie and Lord Leigh of Hurley(2 years, 7 months ago)
Lords ChamberRead Full debate Read Hansard Text
Viscount Younger of Leckie (Con)
I am sure the noble Lord is aware of the support that is given. Following the spending review in 2020, local authorities’ core spending power is estimated to have increased by 4.6% in cash terms in 2021-22. This follows the largest real-terms increase in core spending power for a decade at the spending review in 2019. Local authorities, including the ones he mentioned, will have access to £2.2 billion of additional funding in 2021-22 to invest in public services.
Lord Leigh of Hurley (Con)
My Lords, there are 26 million houses subject to council tax in the UK but only 160,000 are in band H, so a sensible small step might be that just council houses in band H are revalued. As 65,000 of those are in London, it would enhance our reputation for levelling up. Will the Minister agree to a meeting with the Treasury to progress this idea?
Viscount Younger of Leckie (Con)
I can certainly pass on that request to the Treasury—that is no problem at all—but I reiterate that there are no plans to review or revalue council tax. It is important to say that the council tax system is understood by people. A recent poll demonstrated that there is no move from the public to change it.