HC Deb 17 March 1970 vol 798 cc190-1
26. Sir G. Nabarro

asked the Chancellor of the Exchequer what part, and the sum, of the £615 million retained selective employment tax during 1969–70, enters into the prices of food, drinks, confectionery and everything edible for human consumption; and whether he will reduce food and drinks' prices by abolishing such selective employment tax on all employment entering into prices for all food and drink for human consumption.

Mr. Taverne

The evidence we have indicates that S.E.T. has had very little effect on the price of food. The answer to the second part of the Question is that I cannot anticipate my right hon. Friend's Budget proposals.

Sir G. Nabarro

How is it that the Chancellor can estimate the amount of S.E.T. which afflicts housing and the construction industries but cannot estimate the amount of S.E.T. which afflicts food distribution? Why is the hon. and learned Gentleman so incompetent in his inquiries in this matter? Would he explain why last summer the Chancellor accused the Tories, in his speech at Aberystwyth, of being the first party in history to tax food when S.E.T. bears directly as a tax on all food distribution?

Mr. Taverne

I find that question totally incomprehensible. [HON. MEMBERS: "Resign".] The hon. Gentleman has clearly not read the Reddaway Report, which makes it clear that the effect of S.E.T. on distribution is absorbed in increased productivity or reduced profits. [Interruption.]

Mr. Maudling

If the hon. and learned Gentleman finds the question incomprehensible, I will repeat it. It has two parts. First, why is it possible to calculate the effect of S.E.T. on housing and not on food? Secondly, why did the Chancellor say that the Tory Party was the first party to put a tax on food when S.E.T., by his own statement, has an effect on the price of food?

Mr. Taverne

I did not say it had that effect on the price of food. [HON. MEMBERS: "Oh!"] I found it incomprehensible perhaps because I had overestimated the hon. Gentleman's intelligence, which is not always an easy thing to do. I thought that he would have read the Reddaway Report. The Question relates to food, and it is clear that, in respect of food, according to the Reddaway Report, there has not been an effect on prices.

Hon. Members

Disgraceful.

Mr. Maudling

Instead of being rude, would the hon. and learned Gentleman answer the question?

Mr. Taverne

The right hon. Gentleman does not like the answer because he does not like the fact that the Reddaway Report—[Interruption.]

Several Hon. Members rose

——

Mr. Speaker

Order. Mr. Howell, Question No. 27.