§ The Paymaster General (Sir John Cope)
The position remains as set out in my right hon. and learned Friend's Budget statement.
§ Sir John Cope
The hon. Gentleman misunderstands. The real threat to Britain's zero rates on food and all the other things that he listed comes from the socialist European manifesto, which supports qualified majority voting on tax matters, and would hand the decisions over to Brussels.
§ Mr. Bill Walker
Does my right hon. Friend agree that in 1979 we stood on an election platform that included transferring taxation from direct to indirect taxes, and that that meant VAT? Have not we successfully fought the general elections since then on that basis? Even more important, we have demonstrated clearly that when take-home pay keeps increasing and people have the opportunity to spend, they are happy to pay VAT rather than direct tax.
§ Mr. Andrew Smith
Will the Paymaster General now answer the question that my hon. Friend the Member for Worsley (Mr. Lewis) asked? Will the Government give an undertaking not to extend VAT further, in view of the Chancellor's previous stated enthusiasm to do just that?
§ Sir John Cope
I have explained exactly what my right hon. and learned Friend the Chancellor said. The hon. Gentleman must answer the question about handing over the decisions to Brussels. That is what the European manifesto would do—and, incidentally, what the Liberal Democrats' manifesto would do, too.
§ Mr. Waterson
Will my right hon. Friend confirm that those on full retirement pensions and on income support are now receiving generous compensation for VAT on fuel—rather more generous than that demanded by the Opposition spokesman?