§ Mr. Arthur Lewisasked the Chancellor of the Exchequer whether he will give the actual or estimated loss of revenue on an annual basis if smoking were banned; and to what extent value added tax or income tax would have to be increased to recoup the lost revenue from tobacco duty and the value added tax levied on the sale of tobacco and tobacco products.
§ Mr. Peter Rees[pursuant to his reply, 12 May 1980, c. 381]: It is estimated that in 1980–81 the yield from tobacco duty and VAT on tobacco and tobacco products will be about £3,350 million. However, it is not possible to make a reliable estimate of the total loss of revenue if smoking were banned, nor of the increase in VAT or income tax rates required to recoup this loss of revenue. This is because the banning of smoking would have considerable but unquantifiable effects on the yields of other indirect taxes through changes in the pattern of expenditures, on the yield of income tax paid by those previously employed in the tobacco industry, on public expenditure, especially transfer payments, and on the yield of taxes paid by the tobacco industry and its suppliers.
§ Mr. Arthur Lewisasked the Chancellor of the Exchequer whether he will give the amount of taxes paid in total by the tobacco industry, for the latest and most convenient date, on an annual basis.
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§ Mr. Peter Rees[pursuant to his reply, 12 May 1980, c. 381]: I regret that data on the revenue derived from the various taxes, broken down into payments made by individual industries, are not available.