§ 1. Mr. Kirkwood
asked the Chancellor of the Exchequer what estimated increase in revenue would accrue from levying 15 per cent. value added tax on children's shoes.
§ The Financial Secretary to the Treasury (Mr. John Moore)
It is estimated that the net additional full year revenue at 1984–85 prices would be about £50 million.
§ Mr. Kirkwood
Does the Financial Secretary accept the findings of the Munro committee in 1973, which concluded that there was a causal relationship between the price of children's footwear and the incidence of foot disease? Will he accept that a short-term saving of £50 million makes no sense if it prejudices the longer-term health of the nation's feet? Therefore, will he give the House an assurance that the Chancellor of the Exchequer is not considering imposing VAT on children's footwear?
§ Mr. Moore
The Government have no reason to doubt the continuing validity of the conclusion reached by the Munro committee. I know that the hon. Gentleman would not expect me to say more than the Minister of State, Treasury, my hon. Friend the Member for Brentford and Isleworth (Mr. Hayhoe), said on 25 October, which was that we had no set views at present on how the Government might shift the burden of taxation from taxes on earnings to taxes on spending.
§ Mrs. Jill Knight
Will my hon. Friend accept that there is considerable worry on both sides of the House about the possibility of VAT being levied on children's shoes? Will he recognise that the present system, which does not impose VAT on shoes that help developing feet, has certainly made a contribution to the health of children's feet?
§ Mr. Fatchett
Will the Financial Secretary tell us how many jobs would be lost in the boot and shoe industry as a result of the imposition of VAT?
§ Mr. Moore
The Government are aware of the concern expressed by United Kingdom manufacturers of boots and shoes. They have said that the imposition of VAT could 780 lead to a diminution of employment. That is the view of the manufacturers. The Government have listened to them and are aware of that view.
§ Mr. Jessel
Is my hon. Friend aware that those of us who, 12 years ago, discouraged the then Chancellor of the Exchequer from taxing children's shoes have had no reason to change our minds and that we accept the argument that tight shoes for children can cause deformed feet for life? However, is my hon. Friend aware that that argument did not, and does not, apply to other clothing?
§ Mr. Blair
Is the hon. Gentleman aware that Britain is almost unique in Europe in having a proper fitting service for shoes, which greatly contributes to the health care of our children? Does he realise that the uncertainty is undermining confidence in the industry and whetting the appetite of foreign producers of less good footwear? If the Government are not prepared to support British industry in the interests of our children, when are they prepared to support it?
§ Mr. Moore
I hope that it is not inappropriate for me to congratulate the hon. Gentleman on his first appearance at the Dispatch Box. I hope that that will not create too much difficulty for him in his future career. However, I know that he will not expect me to accept the kind of nonsense with which he has started.