§ 25. Mr. William Hamiltonasked the Chancellor of the Exchequer what further consideration he has given to the introduction of a value-added tax; and with which organisations he has had discussions on the matter.
§ Mr. DiamondMy right hon. Friend keeps the whole tax system, including the 939 possibility of changes like the introduction of value-added tax, under continuous review.
§ Mr. HamiltonCan my right hon. Friend say how many additional civil servants will be needed to introduce this tax? Has any assessment been made of the effects of the tax proposed by the right hon. Member for Enfield, West (Mr. Iain Macleod) on the cost of living, because this problem very much exercises the minds of ordinary people?
§ Mr. DiamondThe number of civil servants engaged will depend a great deal on the form and coverage of the tax. The cost of administration would be much greater than for purchase tax and selective employment tax.
On the latter part of the question, I do not think that I am responsible for giving that kind of information.
§ Mr. MaudlingIs not the introduction of the value-added tax a necessary consequence of joining the Common Market?
§ Mr. DiamondThe right hon. Gentleman will be aware of recent developments in the Common Market.
§ 39. Mr. Dickensasked the Chancellor of the Exchequer what discussions he has had with the National Economic Development Council on the introduction of a value-added tax.
§ Mr. DiamondThe report of the Committee set up by the National Economic Development Council to examine value-added taxation was discussed at the Council's meeting in November, 1968, which my right hon. Friend attended.
§ Mr. DickensWill my right hon. Friend bear in mind the very strong representations made by the T.U.C. about the effect of a value-added tax on the lower paid, and that the tax is regressive? Will he also bear in mind the calculation made by N.E.D.C. that to implement the tax would require between 6,000 and 8,000 additional civil servants apart from the substantial number of people who would be employed in this work in private industry as well?
§ Mr. DiamondMy right hon. Friend will bear in mind the nature of the tax and the administrative difficulties associated with implementing it.