§ Mr. John Bercow (Buckingham)I beg to move,
That leave be given to bring in a Bill to require the Treasury to send to each household and business an annual statement of the rates of each tax and excise duty; and for connected purposes.Thousands of hours are spent by Members of Parliament in debates, questions and correspondence about taxation. Since May 1997, there have been no fewer than 3,842 oral and written parliamentary questions in this House and in another place, 61 Adjournment debates and 50 early-day motions. For today's purposes, I am peculiarly grateful to two individuals: first, the Chairman of the Public Accounts Committee, my right hon. Friend the Member for Haltemprice and Howden (Mr. Davis), and secondly, the president of the Adam Smith Institute, Dr. Madsen Pirie.We know that we are more heavily taxed than ever before, but we are told less about that taxation by the Government. My right hon. and hon. Friends are aware that a typical family pays an extra £669 in tax a year under this Government. We know that from House of Commons figures, just as we know from the figures published in the Red Book that the share of gross domestic product accounted for by taxation is scheduled to rise from 35.3 to 37.3 per cent. between 1996–97 and 2001–02. We also know from the Organisation for Economic Co-operation and Development, the Office for National Statistics, PricewaterhouseCoopers, Chantrey Vellacott, the Confederation of British Industry and the Federation of Small Businesses that taxes have risen, that they are rising and that they are scheduled to continue to rise.
That is why we at least now know what Labour meant when it said it would be a people's Government. People who are married, people who pay mortgages, people who own cars, people who put petrol in them, people who acquire savings, people who own pensions and people who run businesses all now face a higher tax burden under this Government. The effect of that pitiful state of affairs is that tax freedom day in this country—the day on which we cease to work for the Chancellor of the Exchequer and start to work for ourselves—is 30 May. Of course, that is 20 days better than in euroland, where tax freedom day is 19 June, but, importantly, it is no fewer than 20 days worse than in the United States, where tax freedom day falls on 10 May.
In the 1950s, the late Winston Leonard Spencer Churchill, as Chancellor of the Exchequer, cut taxes to allow money to fructify in the pockets of the people. Some of my right hon. and hon. Friends think that this Chancellor picks the pockets of the people, and I assert that he plunders the pockets of the people on an unprecedented scale. Unprecedented plunderer though he is, he offers little information about his taxes.
The Chancellor has repeatedly refused to publish the figures that show the impact of direct and indirect taxes on a typical household, or on households in the other income deciles, despite the fact that Conservative Governments in office consistently provided that information for 15 successive years from 1981 to 1996. Rightly, he has been criticised by the Select Committee on the Treasury in its report on the March 2000 Budget, paragraph 35 of which states that in the interests of transparency, such figures should in future be published in the Red Book.
175 Meanwhile, the insouciant Chancellor is busily publishing and distributing his so-called Budget letter. That letter is nothing but tendentious propaganda financed from the public purse. The Chancellor was rightly excoriated by the same Treasury Committee report for that behaviour. In paragraph 90, the Committee argued that if the Chancellor intends, as he has previously suggested, that in future his letter should go not only to the current 400,000 recipients but to every household in the country, a body fully independent of the Government should be involved in its preparation, to guarantee its impartiality.
That observation by the Select Committee leads me to the first of my three proposals. In my Bill, the Treasury is required to prepare and send to every household and business an annual statement of the rates of each tax and excise duty. What criteria should that statement fulfil? First, it should state the rates of those taxes and any change that those rates represent upwards or downwards from the previous year. Secondly, each tax should be in one or more of three broad categories—taxes on individuals' income, taxes on business activity and taxes on personal expenditure.
The third criterion that the statement should fulfil is that instead of taking a narrow and inward-looking parochial view, it should offer a comparison with the tax rates that appertain in the countries that are our principal industrial competitors. Fourthly, and crucially—although I doubt whether this will be music to the Chancellor's ears—the statement should be adjudicated by and subject to the approval of an independent person, such as the Comptroller and Auditor General, before it is routed through the Inland Revenue to every taxpayer in the country. At least that will provide some transparency.
My second proposal is that the proportion of the purchase price of key products that is represented by tax and excise duty should be publicly displayed on the bills that customers pay. I do not know how many hon. Members, or people outside, are aware that 29.5 per cent. of the price of a pint of beer, 50.5 per cent. of the price of a bottle of wine, 61.3 per cent. of the price of a bottle of whisky, 79.3 per cent. of the price of a packet of 20 cigarettes, and a staggering 84.9 per cent. of the price of a litre of unleaded petrol goes directly to Treasury 176 coffers. That information is important. It should be known, and it needs to be communicated directly from now on to unsuspecting taxpayers across the United Kingdom.
My third suggestion is that each year the Treasury should publish an assessment of the merits of each tax, considering not only its yield but its administration cost, its compliance cost and its economic cost in terms of lost output and diminished competitiveness. I think, for example, of inheritance tax, the yield of which is now only one twentieth of the value for which it accounted in 1909. Many countries have at different times and for varying periods got rid of such a tax. Right hon. and hon. Members know that as long ago as 1985 the International Bureau of Fiscal Documentation argued that the cost involved in collecting the tax rendered it useless. We need a proper debate on that important subject.
The myriad complexities of our taxation system defy ready understanding by a busy layman. We know that too much tax is taken from too many people, who are told too little about it. It is time that the Chancellor's sultans of spin were brought to heel and a new era of openness began in which the individual could discover at a glance how, when and to what extent he or she was being fleeced by the Treasury. Providing more information to the public about taxation would create more incentive for the Government to simplify and reduce it.
That is what the Bill seeks to achieve. It is right in itself, it will be popular with the public, it is long overdue, and I hope that the House will give it warm and enthusiastic support.
Question put and agreed to.
Bill ordered to be brought in by Mr. John Bercow, Mr. Graham Brady, Mr. David Davis, Mr. Alan Duncan, Mr. Michael Fallon, Mr. Nicholas Hawkins, Miss Julie Kirkbride, Dr. Julian Lewis, Miss Anne McIntosh, Mr. Owen Paterson, Mr. David Prior, Mr. David Ruffley.