§ 52. Mr. Arthur Lewisasked the Chancellor of the Exchequer (1) what is his estimate of the yield of a 10 per cent. value added tax on caravans as defined in Group 10 of Schedule 4 of the Finance Bill; which of the countries of the European Economic Community operate a value added tax on such items as defined in this group; and at what percentage rates;
(2) what is his estimate of the yield of a 10 per cent. value added tax on food as defined in Group 1 of Schedule 4 to the Finance Bill; which of the countries of the European Community operate a value added tax on food as defined in this group; and at what percentage rates;
(3) what is his estimate of the yield of a 10 per cent. value added tax on books and other items set out in Group 3 of Schedule 4 to the Finance Bill; which of the countries of the European Economic Community operate a value added tax on such items as defined in this group; and at what percentage rates;
(4) what is his estimate of the yield of a 10 per cent. value added tax on water as defined in Group 2 of Schedule 4 to the Finance Bill; which of the countries of the European Economic Community operate a value added tax on such items as defined in this group; and at what percentage rates;
(5) what is his estimate of the yield of a 10 per cent. value added tax on newspaper advertising as defined in Group 4 of Schedule 4 to the Finance Bill; which of the countries of the European Economic Community operate a value added tax on such items as defined in this group; and at what percentage rates;
(6) what is his estimate of the yield of a 10 per cent. value added tax on news services as defined in Group 5 of Schedule 4 to the Finance Bill; which of the countries of the European Economic Community operate a valued added tax on such items as defined in this group; and at what percentage rates;
53W(7) what is his estimate of the yield of a 10 per cent. value added tax on fuel and power as defined in Group 6 of Schedule 4 to the Finance Bill; which of the countries of the European Economic Community operate a value added tax on such items as defined in this group and at what percentage rates;
(8) what is his estimate of the yield of a 10 per cent. value added tax on the construction of buildings as defined in Group 7 of Schedule 4 to the Finance Bill; which of the countries of the European Economic Community operate a value added tax on such items as defined in this group; and at what percentage rates;
(9) what is his estimate of the yield of a 10 per cent. value added tax on transport as defined in Group 9 of Schedule 4 to the Finance Bill; which of the coun-
Rate of VAT in: Item Belgium France Germany Luxembourg Netherlands Per cent. Per cent. Per cent. Per cent. Per cent. Caravans (Large) 25 23 11 10 14 Food 6 7½ 5½ 5,2* 4 Books 6 7½ 5½ 5 4 Water 6 7½ 5½ 5 4 Newspaper Advertising 18 23 11 5 4 News Services 18† Exempt 11† 10† 14† Fuel and Power 6, 14‡ 17.6 11 5 4 Construction 14 23, 17.6§ Exempt Exempt 14 Transport 6 17.6 5½ 5 4 * Meat and bread are taxed at 2 per cent. † Exempt in France, there appears to be no relief in favour of news services and it is therefore to be assumed that they are taxed at the standard rate. ‡ Gas is charged at 6 per cent.; other forms of fuel and power at 14 per cent. § The delivery of new residential accommodation is taxed at 17.6 per cent. on a reduced tax base of 33⅓ per cent. of the value; other construction is taxed at 23 per cent.
§ Mr. Arthur Lewisasked the Chancellor of the Exchequer whether he will publish in the OFFICIAL REPORT an estimate of the number of sports clubs and societies of all kinds, which are commercially engaged, which will come within the scope of the exemption of the payment of value added tax on the basis of those organisations having a turnover in taxable goods and services not exceeding £5,000 per annum.
§ Mr. HigginsNo. Adequate information is not readily available on which to base an accurate estimate.
§ Mr. Arthur Lewisasked the Chancellor of the Exchequer whether he is aware that, on his decision to reintroduce value added tax, the Customs and Excise Department and its staff had to be reorganised due to the increase of 74,000 54W tries of the European Economic Community operate a value added tax on such items as defined in this group; and at what percentage rates.
§ Mr. HigginsAs regards the first part of each of these Questions, I have nothing to add to my answer to the bon. Member for Heywood and Royton (Mr. Joel Barnett) on 9th May.—[Vol. 8:6, c. 326–8.]
The answer to the second part of the Questions depends on the interpretation of the different national legislations in the Six. There are differences in the definition of the various items from country to country which make an exact comparison impracticable. But the following table shows what I understand to be the general position in the five EEC countries which have a value added tax.
firms paying purchase tax to 1½ to 2 million due to pay the new value added tax; to what extent discussions and agreement with the appropriate trade unions took place before this reorganisation; and whether he will make a statement.
§ Mr. HigginsThe reorganisation of the Customs and Excise Department was agreed in 1971 after four years of joint study and negotiation by management and a team fully representative of all the various staff associations in the Department. The discussions were started long before the decision to introduce the value added tax was taken; but the reorganisation will facilitate the Department's task in coping with the work of the new tax.
§ Mr. Arthur Lewisasked the Chancellor of the Exchequer whether he is aware 55W that, due to the increase from 74,000 firms paying purchase tax to 1½ to 2 million which will be liable for value added tax, there will be an increase in the work and responsibility of Customs and Excise officers; whether he will ensure that there will be the required increase in status of the executive officers to higher executive officers and that their salaries will be increased between £500 per annum to £1,000 per annum; and what he estimates the costs of these changes will be.
§ Mr. HigginsAs I indicated in reply to the hon. Member on 12th April, about 6,000 extra civil servants will be required for the value added tax. The grading of the staff will be appropriate to their duties.—[Vol. 834, c. 1258.]
§ Mr. Arthur Lewisasked the Chancellor of the Exchequer whether he is aware that in the European Economic Community countries value added tax is charged on admission to museums and galleries at the standard rate of tax and that in France a reduced rate of 17.6 Per cent. is applied; and to what extent he estimates a return to the Revenue on the introduction of value added tax on entry into galleries and museums at the present stated rate and on the rates as now applied in the countries of the Six.
§ Mr. HigginsRevenue from value added tax on admissions to museums and galleries will depend on several factors and no precise estimate is possible. It would involve disproportionate time and effort to estimate the hypothetical effect on the revenue in the United Kingdom of the legislation of other countries.
§ Mr. Arthur Lewisasked the Chancellor of the Exchequer whether he will give details of the discussions he had with the National Chamber of Trade before his decision to introduce the value added tax; and, as this Chamber has declared that many shopkeepers will face hardship or ruin on the introduction of the value added tax, if he will arrange to discuss these matters with the National Chamber of Trade.
§ Mr. HigginsThe National Chamber of Trade has discussed various aspects of value added tax with Customs and Excise, which is available to have further discussions at any time.