§ Mr. Marksasked the Secretary of State for Prices and Consumer Protection what further proposals she has for amending the Price Code.
§ Mrs. Shirley WilliamsThe increases in indirect taxes announced by the Chancellor will lead to certain higher prices, but the Government do not intend that extra profits should he made at the 89W expense of consumers as a result of these tax changes. This means that price increases should not exceed the cash amount of the tax change, and should not be applied to goods already in stock which did not bear the new rate of tax
To give effect to the Government's intentions changes are needed in the notification arrangements and Price Code rules to clarify the position relating to indirect tax changes.
First, the Price Code rules will be amended so that an addition may be made to prices not exceeding the cash amount of the tax change. The necessary code amendments are annexed in draft.
Secondly, the notification requirements for manufacturers will be amended so that an increase in prices limited to the cash amount of the tax change need not be notified to the Price Commission for prior scrutiny.
The Notification Order is being made today and will come into effect tomorrow There will be consultations about the amendments to the code which will be made as soon as possible and will apply with effect from tomorrow to the tax changes announced today. These code amendments will be made and will take effect in advance of the amendments in the Consultative Document which I published yesterday. Traders concerned with the tax changes will be consulted immediately.
The retail price of petrol is controlled by an order under the Fuel and Electricity Act. The Secretary of State for Energy will be amending the order before 1st April, when the extension of VAT comes into effect.
The Annex is as follows: