§ Baroness Rendell of BaberghMy Lords, I beg leave to ask the Question standing in my name on the Order Paper. In so doing, I declare an interest as an author of books on tape.
The Question was as follows:
Whether they will consider removing the VAT on audio-books on the grounds that these are extensively used by the visually impaired.
§ Lord McIntosh of Haringey: My Lords, the Government recognise the importance of audio-books to the visually impaired. However, under longstanding European agreements, no member state is permitted to make substantial extensions to the scope of its zero rates.
§ Baroness Rendell of BaberghMy Lords, I thank the Minister for his Answer. However, does he agree that, when VAT was introduced in 1973, the audio industry was virtually non-existent? Does he also agree that if the Treasury were rewriting rules now, it might take a different view?
§ Lord McIntosh of HaringeyMy Lords, there are certain dangers in the Treasury rewriting the rules. We benefit very substantially from the fact that, when Annex H to the Sixth Directive was introduced in 1992, we already had zero rating not only on books and newspapers, in particular, but also on children's clothes, food and public transport fares. We were able to continue that because we already had the exemption. If we were to start re-opening the Pandora's box of zero rating, we could put that at risk. Much as I sympathise with what the noble Baroness, Lady Rendell, says about audio-books, I think that on the whole we would prefer not to do that.
Lord Campbell of CroyMy Lords, does the noble Lord accept that audio-books have been of great help to blind people, especially when the voices have been recorded by actors and actresses, and that they are available for lending from public libraries?
§ Lord McIntosh of HaringeyMy Lords, I entirely agree that audio-hooks are a great help to blind people. The Royal National Institute for the Blind, after all, has a scheme of talking books for the blind to which it has about 43,000 subscribers. That equipment and that provision is zero rated. Zero rating, however, must be for equipment specifically designed for people 418 with disabilities, and we take advantage of that exemption. However, audio-books are also of very great interest to others who are not visually impaired.
§ Lord PestonMy Lords, surely the anomaly here, to introduce a discordant note, is the fact that not only hooks, but magazines, periodicals and pornographic literature—if I may remind my noble friend of the existence of such things; I know because I know the law, not because I have ever seen such things—are zero rated? Is it not strange that we refer to that zero rating as a benefit when the essential point is that VAT really should be levelled on everything? Is it not about time that instead of talking about this benefit, we got rid of the anomaly entirely?
§ Lord McIntosh of HaringeyMy Lords, I am always prepared to take instruction from my noble friend Lord Peston. However, I disagree. The zero rating which we have for children's clothes, food, books and newspapers, and public transport fares is a very considerable advantage to us. It is indeed in the Labour manifesto that we shall continue to maintain that zero rating.
Lord RentonMy Lords, is the noble Lord aware that audio-books are also a great help to those who are deaf? That is a further reason for liberating them.
§ Lord McIntosh of HaringeyMy Lords, I am interested in what the noble Lord, Lord Renton, says, and I suppose that audio-books could be played very loud. Audio-books are a great pleasure to a very large number of people, including me. I just wish that the readers would read rather faster than they do.
§ Lord AddingtonMy Lords, does the noble Lord agree that, by taxing audio-books, we are basically just attacking another form of literature? As literature is said to be a good thing, why are audio-hooks not treated as such?
§ Lord McIntosh of HaringeyMy Lords, I have been trying to explain that these anomalies have occurred because of the Sixth Directive, and particularly because of Annex H to that directive. There are changes that we might like to make if the lid were taken off this Pandora's box. However, we are, rightly, very nervous about doing that because of the advantages that we gain. I would not argue for significant changes for that very reason.
§ Lord SelsdonMy Lords, will the Minister be kind enough to advise us how many people in the United Kingdom and the EU are visually impaired? If by any chance the numbers are significant, would he please arrange to change the directive?
§ Lord McIntosh of HaringeyMy Lords, I do not know how many, but clearly it is a very significant 419 number. However, I do not see why that should justify a change in the directive. The directive is very significantly to our advantage.
§ Lord SaatchiMy Lords, if the Pandora's box can never be opened, can the Minister say why, in another place, the Paymaster General said that no accurate estimate is available of the cost to the Exchequer of zero rating audio-books? Why is there no such estimate? May we have one?
§ Lord McIntosh of HaringeyMy Lords, I imagine that there is not one because useful sales figures for audio-books are not available. I do not know the answer to the question, but I do not think that the cost of zero rating audio-books has been a significant factor in our consideration of the issue raised by this Question.
§ Baroness Finlay of LlandaffMy Lords, given the difficulties outlined and the importance of audio-books to patients recovering from severe injury who are unable to hold conventional books or who have brain tumours and difficulty focusing on a page although they are not classified as visually impaired, do the Government have any intention of trying to provide some financial relief for families faced with caring for those with a severe disability for whom audio-books are a major source of comfort?
§ Lord McIntosh of HaringeyMy Lords, as I have made clear, the Government maintain zero rating of VAT for all sorts of equipment and material specifically designed for those with a wide range of disabilities and not just for those with visual impairment. The difficulty with some of these issues, and particularly with audio-books, is that although they are indeed of great help to people with various disabilities, they are also a source of great pleasure to people without disabilities. To introduce a zero rating, even if we could, would be to introduce a further anomaly into the zero-rating system.
§ Lord SwinfenMy Lords, the noble Lord said that children's books were zero rated. Are audio-books for children zero rated?
§ Lord McIntosh of HaringeyMy Lords, I did not say anything about children's books; I said children's clothes. There is no connection between the two.