§ Mr. Nicholas BrownTo ask the Chancellor of the Exchequer how much revenue the Treasury has forgone since January in lost excise duty from the cross-border sales of(a) wines, (b) spirits, (c) beers, (d) cigarettes and tobacco and (e) all of (c) and (d).
§ Sir John CopeThe table shows the estimated total revenue losses, covering both excise duty and VAT, arising from increased cross-border shopping for the whole of 1993. It is not possible to give reliable estimates for different types of alcoholic drink. The estimates have been derived from the results of household surveys conducted by the Office of Population Censuses and Surveys. They take account of the fact that the some cross-border shopping took place before 1993, also that some of the purchases abroad are likely to represent new consumption, rather than substituting for purchases in the United Kingdom.
Revenue loss in 1993 (£m) Excise duty VAT Total Alcoholic drinks 55 20 75 Tobacco products 80 20 100 Total 135 40 175
§ Mr. Nicholas BrownTo ask the Chancellor of the Exchequer what would be the impact in 1994–95 on the retail prices index of raising £1 billion from(a) duty on tobacco products, (b) duty on beer, (c) duty on wine and spirits, (d) duty on petrol, (e) VAT and (f) vehicle excise duty.
§ Sir John CopeThe estimated impacts on the RPI excluding mortgage interest payments are as follows:
400W
£million 1989–90 1990–91 1991–92 1992–93 1993–94 Quota1 1,104.3 ESAF2 17.0 1.5 1.5 10.0 20.0 Net SDR charges3 67.9 69.8 56.0 58.3 558.2 Interest received on reserve tranche position4 33.3 27.8 27.3 22.2 519.2 1As a member of the International Monetary Fund, the United Kingdom pays a subscription, its quota, which was last increased in 1992. 25 per cent. of this increase was paid in special drawing rights from holdings in the exchange equalisation account. This did ot reduce the level of reserves as our reserve position with the fund—the amount the United Kingdom can draw on demand—was increased commensurately. The rest was paid from the National Loans Fund (NLF), in the form of sterling non-interest bearing notes which were placed on deposit at the Bank of England and returned to the NLF. These monetary transactions leave public expenditure and the PSBR unchanged. 2 The United Kingdom makes an annual contribution to the interest subsidy account of the enhanced structural adjustment facility (ESAF), which is a trust fund administered by the IMF. This scores in the ODA's programme as public expenditure. 3 There is a charge to pay on holdings by a member of special drawing rights. Interest is received by the member on its SDR holdings. As the United Kingdom currently holds fewer SDRs than its allocation, it makes a net payment to the fund from the exchange equalisation account which is recorded as a monetary transaction. 4 The United Kingdom receives interest on its reserve tranche position in the IMF, when IMF holdings of sterling are less than the United Kingdom quota. If IMF holdings of sterling are greater than the UK quota, the United Kingdom is required to pay a charge via the exchange equalisation account. Transactions arising from the United Kingdom's reserve tranche position are monetary transactions that affect United Kingdom reserves. 5 To end November 1993.
Per cent. Beer 0.29 Wine and spirits 0.90 Tobacco 0.41 Petrol 0.21 VED 0.22 These estimates assume that the increase in tax is fully passed on to consumers in the form of higher prices. The estimates allow for behavioural changes according to the procedure described in annex A to chapter 4 of the "Financial Statement and Budget Report 1994–95." Increases in petrol duty and VED fall partly on business, so the long run RPI effect for these items is likely to be greater as businesses pass the additional tax on to consumers.