§ 14. Mrs. Currieasked the Chancellor of the Exchequer how much extra revenue would be yielded by each additional percentage point in the rate of value added tax.
§ Mr. BrookeOne percentage point on the standard rate of VAT would bring in about £945 million extra in a full year, at 1986–87 prices.
§ Mrs. CurrieI thank my hon. Friend for his answer. May I ask him to clarify something that I believe I heard his right hon. Friend the Chancellor of the Exchequer say a moment ago about the yield from VAT? I wondered whether he was quite serious about it. Did he say that if this country suffered the twin misfortunes of a future Labour Government and the incredible spending programme that the Labour party has presented to this nation, VAT would not be 15 per cent., as it is now, or 20 per cent., or 25 per cent., or even 30 per cent., but would be 41 per cent.?
§ Mr. BrookeWhen my right hon. Friend the Chief Secretary to the Treasury unveiled the Opposition's spending plans he said that it would require a VAT rate of 41 per cent. to achieve that £24 billion of expenditure. My right hon. Friend was characteristically generous in his estimate. Since larger increases would yield progressively less revenue, the figure would therefore be considerably in excess of 41 per cent.
§ Mr. James LamondIs it sensible for the Minister to use the resources of his Department to construct an entirely fictitious figure, which he says is the cost of the Labour party's programme, and then to encourage all of his hon. Friends to try to make the figure stick by constantly repeating it, as though a lie constantly repeated becomes the truth?
§ Mr. BrookeI was asked about the extra yield of an additional 1 per cent. Even a Treasury Minister can divide £18.5 billion by 15.