Income Tax: Top Rate

Lord Leigh of Hurley Excerpts

Monday 16th March 2015 Lords Chamber

[Lord Newby]

My Lords, I do not know which bits of that question to deal with first. However, given the time, I just point out to the noble Lord that the group of the population whose income, by percentage and absolute amount, has suffered most and which has lost the most is the top 20%. They have seen a 3% cut in their income, which is a greater cut than has been experienced by any other tranche. The noble Lord does not like it because it is an inconvenient truth, but it does not stop it being a truth.

[Lord Leigh of Hurley (Con)]

My Lords, does my noble friend the Minister agree that during the life of this Government corporation tax has fallen from 28% to 21% but corporate taxation revenues from companies has increased from £35.8 billion to £39.3 billion? That underlines the point made by my noble friend Lord Borwick that a decrease in rates of tax helps to increase revenue, reducing the biggest problem that we face at the moment—the deficit.

[Lord Newby]

My Lords, it is important to have competitive corporate tax rates, which is why we have reduced them, although it is obviously the case that you reach the point as you are reducing taxes when you lose revenue. The trick is to get the balance right, which is what we have done by reducing corporation tax, for example, and by putting capital gains tax up very significantly from the level it was under the Labour Government.