§ 10. Mr. Kenneth Bakerasked the Chancellor of the Exchequer whether he will now make a study of the effects of introducing a value-added tax in the United Kingdom in view of the pending negotiations with the Common Market.
§ Mr. DiamondI have nothing to add to what I told the hon. Gentleman on 25th November.—[Vol. 792, c. 45.]
§ Mr. BakerDoes the Chief Secretary recall that his colleague the Chancellor last year made certain speeches in favour of the Common Market and on different days certain speeches attacking a value-added tax? These views are inconsistent. and if the Chancellor is to be consistent in 1970 is he to come out against the Common Market or in favour of a value-added tax?
§ Mr. DiamondAll Treasury Ministers are wholly consistent. There is no inconsistency in what my right hon. Friend said and no inconsistency in the supplementary answer I now give, which is to refer the hon. Member to the very full statement made on this point by my right hon. Friends the Prime Minister and the Foreign Secretary.
§ Mr. GardnerDoes my right hon. Friend accept that whatever the other effects of a value-added tax may be, it is likely to lead to very substantial increases in prices to the consumer?
§ Mr. DiamondI am bound to give my hon. Friend a serious answer and to draw his attention to the fact that questions relating to the effect of a tax depend on the rate and coverage of the tax.