HC Deb 13 May 1969 vol 783 cc1205-6
21. Mr. Sheldon

asked the Chancellor of the Exchequer if he will now make a statement on his studies of the effect of taxation upon incentives.

Mr. Diamond

I wrote to my hon. Friend on 29th April outlining my conclusions.

Mr. Sheldon

While I am grateful to my right hon. Friend for sending me that letter, which I read with interest, may I ask him to reflect that it did not take the matter much further since it did not show that the Government are themselves carrying out the researches and studies mentioned in the Question, which is the point with which I am particularly concerned? Is he aware that when raising so much money by way of revenue, the least he should do is to carry out some research into the effectiveness of raising that money?

Mr. Diamond

My hon. Friend will recall that in the long letter which I wrote to him I described the results of seven pieces of research.

Mr. Sheldon

But none of them by the Government.

Mr. Diamond

I indicated the preliminary research that the Government had done and I told my hon. Friend—I repeat it now—that we were not aware of any method of selecting, dissociating or finalising the various effects to which he referred; in other words, of separating all the various effects of taxation on a man's employment, his level of wages and the various other incentives that exist. If my hon. Friend has a precise method of doing this work, I should be glad to hear about it and I assure him that I would follow it up.

Mr. Patrick Jenkin

Will the right hon. Gentleman place in the Library the correspondence which he has had with his hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) so that all hon. Members may study what appears to be an extremely interesting document?

Mr. Diamond

I would be delighted to do so, after consulting my hon. Friend.

Mr. Sharples

Has the right hon. Gentleman's attention been drawn to the views of the C.B.I. on this matter? Has the expression of those views led to an officially sponsored call by the Labour Party for the dismissal of the Director-General of the C.B.I.?

Mr. Diamond

That supplementary question has no bearing whatever on the main Question. [HON. MEMBERS: "Answer."] I am aware of the views of the C.B.I. and, as far as I know, the C.B.I. has no means of conducting further research which is likely to throw up the essential information which we would all like to have.