§ Mr. McCrindleasked the Chancellor of the Exchequer what estimate he has made of the increase in the rate of inflation from current levels if value added tax at 15 per cent. were imposed on all goods and services; and if he will make a statement.
§ Mr. BrookeThe direct effect of imposing value added tax at 15 per cent. on all these goods and services which are currently zero rated would be to raise the level of retail prices by 4 per cent. The Government's medium term financial strategy ensures that there would be no lasting effect on the rate of inflation.