§ 8. Mr. Michael Marshallasked the Chancellor of the Exchequer what revenue was raised from the 8 per cent. 658 rate of VAT on cesspit sewage disposal during the financial year 1975–76.
§ Mr. Robert SheldonI regret this information is not available.
§ Mr. MarshallDoes the hon. Gentleman accept that, whatever the figure may be, it is likely to be piffling in relation to the resentment felt at the bureaucratic incompetence that brings this particular charge to bear? Will the hon. Gentleman take this opportunity of agreeing to bring in a zero-rating charge level, which would be a fair move and could be recouped by a 10 per cent. rate of VAT, which we have urged for services generally?
§ Mr. SheldonThe hon. Gentleman talks about bureaucratic incompetence. This charge is an essential part of the 1972 Act, which was introduced by the previous Conservative Government. It was they who imposed this tax and the charge is a direct consequence of their measure. Any bureaucratic incompetence can be directly attributable to their action on that occasion.
§ Mr. MartenWill the hon. Gentleman confirm that the Scrutiny Committee was told the other day by officials from the EEC that last November the Government gave an undertaking to the EEC not to extend zero-rating? Was that so? If so, why was a statement not made to the House of Commons?
§ Mr. SheldonI do not know where the hon. Gentleman gets his information. I can assure the hon. Gentleman that no commitment on zero-rating has been made. If he is thinking about cesspool treatment in the EEC, I can tell him that in that context there is a wide range of variation.
§ 10. Mr. Madelasked the Chancellor of the Exchequer how many representations he has had asking him to zero rate VAT on the collection and disposal of sewage from properties unconnected to main drainage.
§ Mr. Robert SheldonAbout 15 since the beginning of the year.
§ Mr. MadelIs the hon. Gentleman aware that before the recent House of Lords decision on this matter, the sewage rate was zero-rated because rates themselves are zero-rated? Therefore, the loss of revenue argument cannot be used 659 if we zero-rate sewage collection from unconnected properties. Bearing in mind that gas, electricity and water are zero-rated, essential services for the home, why cannot the Government make this extension and zero-rate as suggested in the Question?
§ Mr. SheldonThe problem, which the hon. Gentleman may well understand, is that when a local authority is in competition with the private sector, it has to be treated in exactly the same way, and the private sector has the standard rate of value added tax applied to it.