Coinage (Hansard, 22 March 1973)

§ 19. Mr. Golding
asked the Chancellor of the Exchequer whether he will introduce a new coin of the value of ¼p.

§ Mr. Higgins
No, Sir.

§ Mr. Golding
Since the minimum percentage increase that can practically be added to an item costing 5p is 10 per cent. and the minimum that can practically be added to an item costing 2½p is 20 per cent., will the hon. Gentleman tell us what will be the amount of VAT upon items which cost less than 5p?

§ Mr. Higgins
This is a well-known difficulty with price changes on items with a low unit value. The prices unit of the Department of Trade and Industry and the Ministry of Agriculture, Fisheries and Food is advising traders to look at the range of goods they supply as a whole and to ensure if they round up to the nearest ½p in some cases they round down to the nearest ½p in others. Provided that, overall, they pass on to their customers the net effect of the tax changes, this is perfectly fair. There are provisions in the Counter-Inflation Bill to ensure that this is done, and if any constituent of the hon. Member or any other hon. Member has a case in mind, he can refer it to the machinery which has been provided. In this context, it is a very different situation from that which existed before decimalisation.

§ Miss Fookes
Would it not be more to the point if my hon. Friend increased the size of the ½p, which seems to be specially and perversely designed to cause the maximum inconvenience and cursing to the general public?

§ Mr. Higgins
Many hon. Members— on the Government side of the House, at any rate—voted on the question of the form of decimal currency on a free vote, unlike hon. Members opposite, who were whipped into support of the pound system, of which many people have expressed disapproval. The ½p is fulfilling a useful function, particularly in relation to the point made by the hon. Member for New-castle-under-Lyme (Mr. Golding) about price saving.