HC Deb 24 October 1972 vol 843 cc964-6
3. Mr. Sydney Chapman

asked the Chancellor of the Exchequer if he will list in the OFFICIAL REPORT all the goods and services it is proposed should be exempted from the general rate of the value added tax.

The Financial Secretary to the Treasury (Mr. Terence Higgins)

My hon. Friend will find the list in Schedule 5 to the Finance Act, 1972.

Mr. Chapman

Does my hon. Friend agree that one of the main aims of the new tax, replacing, as it does, selective employment tax and purchase tax, has been successful—namely, that its base and incidence should be as widespread as possible to keep its rate as low as possible? If he feels that that aim has indeed been achieved, would he be prepared to commit the Treasury to a review, at the earliest possible opportunity, of the perhaps inevitable but nevertheless irritating anomalies and unfairnesses which have been created, such as in the case of children's clothing, uncut flowers and the design professions in the construction industry?

Mr. Higgins

I agree with the first half of what my hon. Friend said, but I cannot accept what he said about anomalies. All these matters were debated at considerable length during our debates on this year's Finance Bill, and it would be premature for me to say anything more at this stage.

Mr. Dalyell

Why is the Committee on Value Added Tax on Children's Shoes taking so long to report?

Mr. Higgins

It is not fair to the Committee to say that it is taking a long time. It is doing a thorough job. As my right hon. Friend made clear in appointing the committee, it was his intention that it should report in time for its views to be taken into account before next year's Budget. There is a Question on the Order Paper later, and I do not wish to say more on the subject now.

16. Mr. McCrindle

asked the Chancellor of the Exchequer if he will list those items which the Child Poverty Action Group asked him to relieve from value added tax and which he has decided to relieve.

Mr. Higgins

The Child Poverty Action Group asked last February that food, other than items at present liable to purchase tax, houses and rents, fuel, foot- wear, clothing, transport and vehicles, health services, education, newspapers, books and periodicals should be relieved from value added tax or that in some cases the rate should be reduced. All these except vehicles, footwear and clothing have been relieved by zero-rating or exemption.

Mr. McCrindle

Is my hon. Friend satisfied in general that the introduction of VAT will not materially affect the ability of charities to continue to raise money and thereby to carry out their good work?

Mr. Higgins

The question of charities was debated at considerable length in the proceedings on the Finance Bill. The House will be aware of those debates and the announcements made by my right hon. Friend at that time. We have received further representations from charities which will be carefully considered.