IR3                                                       29 November 1994
            CAPITAL GAINS TAX: ANNUAL EXEMPT AMOUNT

The Chancellor proposes in his Budget to increase the annual exempt 
amount to pounds 6,000 in line with statutory indexation.  For the 
tax year 1995-96, each individual will be exempt from capital gains 
tax on the first pounds 6,000 of gains.  Most trusts will be exempt 
on the first pounds 3,000 of gains.

                       NOTES FOR EDITORS

1.   An individual whose total net gains in a tax year do not exceed 
the annual exempt amount is not liable to capital gains tax.  Under 
the Chancellor's proposal, this will rise to pounds 6,000 for the tax
 year 1995-96.

2.   Husbands and wives are each entitled to their own separate 
exemption.  The total exempt amount available to a married couple 
will rise to pounds 12,000 for 1995-96.

3.   An exemption of pounds 6,000 will also be available to the 
trustees of a trust for a mentally handicapped person or for a 
person receiving attendance allowance or the middle or higher 
rate of disability living allowance.  For trustees of other 
settlements the exempt amount will be pounds 3,000.

4.   An exemption of pounds 6,000 will be available to personal 
representatives for gains accruing to them in the year of death and 
the two following years of assessment.

5.   The exemptions are automatically increased each year in line 
with the Retail Prices Index unless Parliament determines otherwise. 
The Chancellor's proposals will increase the exemptions in line with 
this statutory indexation.

6.     Measured against an indexed base, the cost of this measure is 
zero.