§ 4. Mr. Michael Jack (Fylde)How many new taxes and increases in tax rates he has introduced since 1997; and how much revenue has been raised by these measures. [141836]
§ The Chief Secretary to the Treasury (Mr. Andrew Smith)All changes to the tax system and their revenue consequences are included in the relevant Budget reports.
§ Mr. JackI am grateful to the right hon. Gentleman for that reply, as the reports confirm that, contrary to their manifesto commitment, the Government have introduced new taxes. The pre-Budget report shows that for this financial year and the next two, as a result of the introduction of new taxes such as the climate change levy, there is a trend of rising taxation on business as a percentage of GDP. Does the right hon. Gentleman agree 793 that in the light of yesterday's sad announcement concerning Vauxhall, the time is right for a thorough review of Labour's burden of tax on business?
§ Mr. SmithOn the pre-Budget report and the share of taxation in the economy, we observe that that share is lower this year, was lower last year and will be lower next year than planned by the last Conservative Government. Unlike the Conservatives, we have kept every promise that we made on tax. That includes the measures that we have taken on taxation to help business: the 3 percentage point cut in the main rate of corporation tax; the 3 percentage point cut in the small businesses rate of corporation tax; the introduction of the new research and development tax credit to help small businesses to innovate and to invest; and the changes that we have made to capital gains tax, reducing from 40 per cent. to 10 per cent. the tax on assets held for four years. That is the mark of a Government who believe in this country's businesses and are making sure that our taxation policies, as well as our policies for fiscal, monetary and economic stability, foster sustainable growth in place of the shambles and the boom and bust of the previous Government.
§ Mr. Peter L. Pike (Burnley)Is it not important to remember that the overriding aim of the Government in taxation policy has been to make our taxation system fairer and help the poorest sections of the community, which we have done with income tax and so many other measures? Should we not remember what the previous Government did time after time, especially the intended 17.5 per cent. VAT on gas and electricity? We stopped that measure under the previous Government; VAT on gas and electricity has been reduced to 5 per cent., which has helped many of the poorest people in the country.
§ Mr. SmithMy hon. Friend is absolutely right to remind the House of one of the worst of the previous Government's broken promises. Contrary to everything that they said before their last Administration, they put VAT on fuel and it hit the poorest hardest. We promised to cut it to its lowest possible level—a promise made and a promise kept—just as we promised not to increase the upper or basic rate of income tax. Indeed, we have cut the basic rate of income tax, along with introducing the working families tax credit, the minimum wage, the new deal and measures not only to get many more people into work but to ensure that they are better off, and that the poorest gain most of all.
§ Mr. John Bercow (Buckingham)Why did the Chancellor of the Exchequer fail in his speech on the pre-Budget report even to mention the huge hike in national insurance contributions that will have to be paid by up to 1 million people who earn approximately £30,000 a year? Is the Chief Secretary proud of the fact that, as a result of that further stealth tax, something of the order of 20,000 nurses, 9,000 policemen and 23,000 teachers will face an additional burden of taxation of £200 a year?
§ Mr. SmithNot for the first time, the hon. Gentleman asks yesterday's question. My right hon. Friend the Chancellor dealt very ably with all these matters then. Of course, there is nothing new in this—the matters to which the hon. Gentleman refers were announced in the 794 1999 Budget. Moreover, they were part of a package that increased the lower earnings limit, taking 900,000 people out of national insurance contributions altogether, and benefiting 16 million people in all by up to £2.10 a week, as compared with April 1999. That means that no one pays national insurance contributions on earnings below £87 a week. That, again, is a very good example of how our fiscal policies are reinforcing what we are doing in helping people off welfare and into work.