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Financial impact of single Income Tax rate

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32

WQ.334/2019

WRITTEN QUESTION TO THE MINISTER FOR TREASURY AND RESOURCES BY DEPUTY G.P. SOUTHERN OF ST. HELIER

ANSWER TO BE TABLED ON TUESDAY 16th JULY 2019

Question

Will the Minister state how much additional Income Tax would be generated by the application of a single rate of 27% to all Income Tax payers with all allowances applied and show how this additional sum would be distributed across Income Tax payers by income decile?

Answer

The additional income tax that would be generated by the application of a single rate of 27% to all income tax payers with all allowances applied is £39m[i] (see WQ.331.2019 tabled 16 July 2019 for further detail).

The distribution of this additional tax by income decile (displayed lowest to highest) is shown in the table below:

 

Decile

2017  Marginal  26%  and Standard at 20%

2017 all at marginal 27%

Difference - £m

1

£3.0m

£3.1m

£0.1m

2

£5.8m

£6.0m

£0.2m

3

£10.3m

£10.7m

£0.4m

4

£14.4m

£15.0m

£0.6m

5

£18.0m

£18.7m

£0.7m

6

£23.9m

£24.9m

£0.9m

7

£32.2m

£33.4m

£1.3m

8

£44.3m

£46.0m

£1.7m

9

£67.8m

£71.0m

£3.2m

10

£176.7m

£207.1m

£30.4m

Grand Total

£396.3m

£435.6m

£39.4m

Please note - Numbers presented in this table have been rounded independently to the nearest £0.1m; therefore, rows and columns may not sum to the total shown.