HC Deb 30 July 1980 vol 989 cc1501-2
10. Mr. Knox

asked the Secretary of State for the Environment what representations he has received supporting the domestic rating system.

Mr. Heseltine

None, Sir.

Mr. Knox

Does that not suggest, to put it mildly, that the domestic rating system does not have many friends? In view of the unfairness of the system, particularly to single-income households, when will my right hon. Friend introduce legislation to abolish or reform the system?

Mr. Heseltine

Had my hon. Friend turned the question the other way around, the answer would have been very different. I am considering the issue of domestic rates. In my Department we have begun working on the alternative to the present system. I shall have to ask the House to bear with me until we are able to complete the detailed work that is necessary to enable us to take a considered judgment before bringing any proposals to the House

Mr. Marks

I am sure that the Secretary of State has in front of him the figures that would result from increasing VAT or income tax to provide the equivalent of the domestic rate. Will he give us those figures? In view of his dictation to local authorities, is it not time that those taxes took over some of the burdens of domestic rates?

Mr. Heseltine

It would be wrong to give the impression that the Government are committed to those alternatives. We are looking at all the alternatives, of which those are only two. It would be wrong to plant figures in the minds of hon. Members as if that indicated the only option that the Government were considering.

Mr. Murphy

Will my right hon. Friend confirm that a poll tax is among the alternatives that he is considering?

Mr. Heseltine

Yes. I am looking at the poll tax, in that I see it as my duty to look at all the alternatives. That is one of them.

Mr. Straw

Why should the House show any patience with the Secretary of State, bearing in mind that in 1976 he said that the abolition of the domestic rating system was one of the wisest political commitments that he and his party had ever made? Did he make that statement not knowing how he would replace the domestic rating system? As the alternatives to domestic rating were well aired in the Layfield report, which does he intend to pursue—local income tax, a block Government grant or a local sales tax?

Mr. Heseltine

The hon. Member might wait until we look at all the alternatives. He should remember that since the initial commitment was made to abolish domestic rating we have had a Labour Government who dramatically increased the levels of income tax. It is the reduction of that income tax that has priority over and above the question of domestic rates.