§ Mr. William RossTo ask the Chancellor of the Exchequer what is his estimate of the revenue which would arise from a 1 per cent. increase in value added tax.
§ Sir John CopeTable 7 of the publication "Tax Ready Reckoner and Tax Reliefs" shows that raising the standard rate of VAT by 1 percentage point would raise £2,245 million in 1994–95.
§ Mr. William RossTo ask the Chancellor of the Exchequer what is his estimate of the revenue raised by a value added tax level of 8 per cent. on(a) passenger transport, (b) water and sewerage service, (c) children's clothing, (d) children's shoes, (e) newspapers and magazines and (f) books.
§ Sir John CopeIn July 1993 the Treasury published "Tax Ready Reckoner and Tax Reliefs". Table 9 of this publication shows the estimated cost of the main zero rated items in 1993–94 compared with applying the standard rate of VAT. The relevant figures are as follows:
381W
Revenue £ million Domestic passenger transport 1,150 Water and sewerage services 800 Children's clothing and shoes 600 Books, newspapers and magazines 1,100 These figures can be adjusted pro rata to arrive at a rough estimate of the yield from applying a different rate of VAT to these items. The figures make no allowance for changes in behaviour that would result from applying VAT to these items.
§ Mr. HaselhurstTo ask the Chancellor of the Exchequer what would be the yield in a full year of(a) 5 per cent. and (b) 8 per cent. VAT on everything which is currently zero rated, including domestic fuel.
§ Sir John Cope[holding answer 21 October 1993]: Applying VAT to all currently zero rated items, including domestic fuel and power would raise the following:
VAT rate Per cent. Revenue £ billion 5 5.0 8 8.0 These figures are based on the year 1993–94 and make no allowance for changes in behaviour.