HC Deb 06 June 1996 vol 278 cc515-6W
Mr. Barry Field

To ask the Chancellor of the Exchequer what account was taken in the company profit component of the gross domestic product figures for the Isle of Wight of the profits of companies or holding companies whose headquarters are not based on the Isle of Wight; and how the effects of the rules relating to habitual residence were applied. [28442]

Mrs. Angela Knight

[holding answer 7 May 1996]: For the compilation of regional gross domestic product, profits of multi-regional companies are allocated to the area in which they are generated, either directly where data are available or otherwise by the use of proxies such as wages and salaries of employees in the area.

Habitual residence appears to refer to the main residence of an individual for the Inland Revenue's assessment of tax. Taxes are transfers of income not involving productive activity; habitual residence is not a term associated with gross domestic product since the latter is a measure of production.