HC Deb 06 May 1958 vol 587 cc1025-6
40. Mrs. Mann

asked the President of the Board of Trade, as a result of his examination of the particular examples submitted to him, if he will now make a personal study of the extent to which retailers are passing on reductions in Purchase Tax to their customers.

Mr. Erroll

I have considered the examples which the hon. Lady has sent. In at least one case the complaint seems to be due to a misunderstanding, because Purchase Tax is levied on the wholesale value of the goods and a reduction of 30 per cent. of the tax will lower the retail price by a very much smaller percentage, which depends on the size of the retail mark-up.

In other cases, it appears that the price reductions which have been made have not reflected the whole of the reduction in Purchase Tax, possibly because the manufacturers have taken the opportunity to make increases in price which would have had to come anyway because of higher costs. I have seen nothing to suggest thet action of this kind has been widespread. The hon. Lady's examples were confined to the products of some half-a-dozen firms. If the public consider that firms which act in this way are giving them worse value than their competitors, they will no doubt follow the example of one of the hon. Lady's correspondents and stop buying the products of these manufacturers.

Mrs. Mann

The Parliamentary Secretary has said nothing at all about retailers passing on these reductions. I now want to ask him whether he approached the Daily Mirror to say that he was accepting my offer to go shopping. Did he arrange that the Daily Mirror should negotiate with me to be accompanied by a reporter and a camera and Press men? If all this was done without informing me in any way, is it not contrary to Parliamentary practice for the hon. Gentleman to act in that way?

Mr. Erroll

I did ring up the newspapers, because it criticised my right hon. Friend the President of the Board of Trade for his apparent failure to accept the hon. Lady's invitation. I rang up the newspaper, mentioned that the President was on the point of leaving for America, and said that I was willing to accept in his place. Needless to say, I intended no discourtesy to the hon. Lady, and I am sorry that I did not telephone her first.