§ 19. Mr. Tilleyasked the Chancellor of the Duchy of Lancaster whether he will make a statement on the effect of increased value added tax on the arts.
§ Mr. St. John-StevasThe effect cannot be predicted because it cannot be separated from the effect of the Government's reduction in general taxation and depends on people's personal choice. This change in the balance of taxation could be beneficial to the arts.
§ Mr. TilleyIs the right hon. Gentleman aware that his answer will be regarded as complacent and inadequate, particularly by arts and theatre administrators who have already made calculations and realise that the effect of increased VAT on ticket prices and accessibility will be very great? This will affect not only commercial theatres but companies such as the Royal Shakespeare, at the Old Vic in Lambeth, and many community theatres. How can he speak of balance in the Budget when arts enterprises have to face, on the one hand, the certainty of cuts which are substantial and savage and, on the other hand, the certainty of the increased cost of VAT? Does he not appreciate that such enterprises are having to balance those factors against the possibility that people who may have more money in their pockets as a result of the tax changes give some towards the arts?
§ Mr. St. John-StevasThe hon. Gentleman must wait and see the effects of the Budget before passing a premature judgment.
§ Mr. LathamIs it not the case that it Parliament takes a decision, as it rightly did, to move the balance from direct to indirect taxation, theatre tickets have to take their place in the priorities?
§ Mr. St. John-StevasI appreciate that point. I regard the increase in VAT as, at the most, a necessary evil.