HC Deb 23 November 1971 vol 826 cc1111-3
3. Mr. William Hamilton

asked the Chancellor of the Exchequer what is his latest estimate of the number of additional civil servants necessary to administer the proposed value-added tax.

Mr. Maurice Macmillan

I have nothing to add to the answer given to my hon. Friend, the Member for Worcestershire, South (Sir G. Nabarro) on 10th November.—[Vol. 825, c. 189.]

Mr. Hamilton

But as that reply was singularly uninformative, will the hon. Gentleman now state whether the Government have come to any kind of estimate on this, in view of the fact that about two years ago the N.E.D.C. gave an estimate of 6,000? Can the hon. Gentleman say whether there will be a net increase at all in the number of civil servants, and whether the Daily Telegraph this morning was right in its estimate of about 7,000?

Mr. Macmillan

It is not possible to give any meaningful estimate of numbers until decisions are made on the scope and coverage of V.A.T. As the hon. Gentleman knows, there will be offsets from not having to administer various other measures which are being abolished, such as S.E.T., purchase tax, and so on.

Sir G. Nabarro

While endorsing what my hon. Friend said about the scope of the tax, may I ask him to bear in mind that the long period which will elapse between now and next April, when final decisions are taken on this form of tax and its scope, is likely to cause all wholesalers and retailers to run down their stocks, all of which is aggravating the unemployment situation by the diminution of demand for manufactures? Will my hon. Friend therefore make his statement about the scope of the tax much earlier than next April?

Mr. Macmillan

That is an entirely different matter from that of the number of civil servants required to administer the tax, but I have noted what my hon. Friend said.

11. Mr. Biggs-Davison

asked the Chancellor of the Exchequer whether he will make a statement on the liability to value-added tax of goods held in stock at the time it comes into force.

The Financial Secretary to the Treasury (Mr. Patrick Jenkin)

I have nothing to add to the Answer I gave to the hon. Member for Birmingham, Ladywood (Mrs. Doris Fisher) and my hon. Friend, the Member for Worcestershire, South (Sir G. Nabarro) on 26th October.—[Vol. 823, c. 281.]

Mr. Biggs-Davison

Before people begin running down stocks and therefore creating unemployment, may we take it that there is an assurance that such goods will not be subject to both purchase tax and V.A.T.?

Mr. Jenkin

A large number of representations have been made both to the Customs and Excise and to Treasury Ministers on this subject. I would prefer to say no more at this stage. It would be wrong to anticipate my right hon. Friend's decision.

22. Mr. Farr

asked the Chancellor of the Exchequer if he will, when purchase tax is ended, make arrangements to ensure that foodstuffs are zero rated for value-added tax, especially including potato crisps and chocolate-coated biscuits.

Mr. Maurice Macmillan

I would refer my hon. Friend to my hon. Friend's reply to the hon. Member for Swindon (Mr. David Stoddart) on 16th November.—[Vol. 826, c. 81–2.]

Mr. Farr

Is my hon. Friend aware that only a very few food products attract purchase tax and that they are mostly consumed either by the very young or by the very old? When purchase tax comes to an end, will the Minister look at this matter again with a view to having a zero rate on food products?

Mr. Macmillan

I have noted my hon. Friend's suggestion, but I am unable to add to what my right hon. Friend has said several times, namely, that food will be relieved of value-added tax except perhaps some items which are subject to purchase tax. We are not yet ready to announce the method or scope of the relief.

Mr. Taverne

But surely there is no earthly reason at all why the Government should not state now whether food will be zero rated or exempted?

Mr. Macmillan

It would be very bad practice to start giving the scope and method of coverage of value-added tax item by item. My right hon. Friend will announce the whole lot in due course.

24. Mr. Leslie Huckfield

asked the Chancellor of the Exchequer whether he will make a further statement on the use of computers in the administration of a value-added tax.

Mr. Maurice Macmillan

The Answer given to the hon. Member on 27th July referred to the installation of the I.C.L. system 4/72 computer, in preparation for this an I.C.L. system 4/50 computer has been installed in Southend for Customs and Excise to carry out programming tests and trials.—[Vol. 822, c. 199–200.]

Mr. Huckfield

Is not the hon. Gentleman aware that unless he gives more information about computer developments than this there is serious risk that the computer software will not be available? Is he further aware that this will have the direct consequence that V.A.T., in addition to being socially regressive, administratively could be a total fiasco?

Mr. Macmillan

Customs and Excise are carrying out their programming tests and trials, and they have to decide not only on the hardware but on the software required.