HC Deb 10 December 1992 vol 215 cc985-6
6. Mrs. Gorman

To ask the Chancellor of the Exchequer what plans he has to increase the rate of value added tax.

Sir John Cope

My right hon. Friend has no plans to do so.

Mrs. Gorman

I thank my right hon. Friend for his reply. Will he take this opportunity to reiterate that it is no part of the Government's policy to increase either indirect or direct taxes? We know that economic recovery means that we must leave spending power in the domestic economy and relieve the pressure for increased wages. Of course, higher taxes would reduce people's income and take money out of the pocket of the business man who wishes to invest his money in his firm. Does my right hon. Friend agree that the economic strides made by the Government in the last decade were built on the back of tax reductions, not of tax increases?

Sir John Cope

My hon. Friend has given us a shrewd analysis of some of the factors that my right hon. Friend the Chancellor will need to take into account in the Budget.

Mr. William Ross

The Minister has told us that the Government have no plans to increase the rate of taxation. Will he also assure us that they have no plans to increase the scope of taxation, and especially that they have no plans to include newspapers and other periodicals?

Sir John Cope

We have no plans of that sort.

Mr. Alan Howarth

If at some point my right hon. Friend the Chancellor has reason to suppose that the public sector borrowing requirement might become disproportionately large, and if the Cabinet concludes that that cannot be remedied by tightening control of public expenditure, will the Government be willing to increase taxation, and to do so sooner rather than later?

Sir John Cope

Those are decisions that my right hon. Friend will have to take as we get nearer the Budget. As always, we are grateful for my hon. Friend's advice.

Mr. Campbell-Savours

Did the £4,000 contribution that was made by the Treasury to the Chancellor of the Exchequer to enable him to evict a stripper from his private home include a VAT component? Do the Government intend to increase VAT on legal matters?

Sir John Cope

We have no plans in that respect. The hon. Gentleman will always do his best to cheapen the debate.

Mr. Nigel Evans

Does my right hon. Friend agree that not so long ago we fought a general election and that one of our major platforms was taxation—both direct and indirect? The public knew our taxation policies and were also well aware—[HON. MEMBERS: "Ask a question."] Does my right hon. Friend agree that the public knew what our taxation policies were and what those of the Labour party were? That is one of the major reasons why we are sitting on this side of the House and Labour Members are sitting on that side.

Sir John Cope

I absolutely agree with my hon. Friend.

Mr. Nicholas Brown

The Paymaster General is being unnecessarily coy. On 12 March, his predecessor told us of the "categorical pledges" that had been given by the Chancellor and the Prime Minister that there would be no increase in the standard rate of VAT either before or after the election. The Paymaster General's predecessor also assured us that there were no plans to extend the standard rate, or to put up other taxes."—[Official Report, 12 March 1992; Vol. 205, c. 959.] Will the Paymaster General confirm that those categorical pledges still hold good?

Sir John Cope

Those categorical pledges stand as they did at that time.