HC Deb 01 April 1969 vol 781 cc217-8
20. Mr. Kenneth Baker

asked the Chancellor of the Exchequer when the Government's examination into the value added tax will be completed; and whether a report will be published.

Mr. Diamond

I do not think that it would be appropriate for me to comment on this subject so soon in advance of the Budget.

Mr. Baker

Has not the Chief Secretary recognised that one way out of our economic malaise would be for us to have substantial cuts in direct taxation—Income Tax and Surtax? Is he aware that if these cuts were achieved, we should need broadly based indirect taxes, probably of a value-added nature or a sales tax? What is Government policy on this matter?

Mr. Diamond

I can guarantee to the hon. Gentleman that he will have Government policy one fortnight from today.

Mr. Gardner

None the less, will my right hon. Friend bear in mind in considering the prospects of value-added tax the disastrous effects it would have on consumer prices?

Mr. Diamond

Yes, of course. There are substantial arguments on both sides in regard to a value-added tax, and I note what my hon. Friend said.