§ Mr. Heathcoat-Amory
To ask the President of the Board of Trade if she will estimate the effect on domestic energy consumption of a reduction in VAT on domestic fuel and power to 5 per cent. 137W
§ Mr. Battle
[holding answer 1 July 1997): Since the announcement of this cut in the budget we have had the opportunity to fine tune the modelling of this VAT reduction. As a result, it is estimated that reducing VAT on domestic fuel will increase domestic sector energy consumption by around 0.7 per cent.