§ 9. Mr. Hall-Davisasked the Chancellor of the Exchequer what studies he has made of the effects of negative fiscal drag on future tax levels in the light of projected central Government and local government expenditure and forecasts of growth of gross national product.
§ Mr. Joel BarnettThe effects of negative fiscal drag—that is, the effect on tax levels of not increasing specific duties in line with inflation—are kept under constant review.
§ Mr. Hall-DavisHave we not reached the point of accelerating inflation which makes increases in tax rates inevitable, and is not the position aggravated by sticking to an outdated property rating system which makes it politically impossible to increase local revenues in line with the increase in local government expenditure?
§ Mr. BarnettAs the hon. Gentleman knows, the whole question of local revenue is under review in another committee. We must await that report.