§ Mr. Nicholas BrownTo ask the Chancellor of the Exchequer if he will estimate for 1991–92 the additional revenue that would be generated by an increase of 5 per cent. in the rate of value added tax levied on those products which were historically subject to a 25 per cent. purchase tax.
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§ Mrs. Gillian ShephardAround £2.5 billion in a full year.
§ Mr. CousinsTo ask the Chancellor of the Exchequer what is his estimate of the total burden to commerce and industry of re-programming computers, reprinting brochures, changing notices and other indirect costs arising from the change in the rate of value added tax.
§ Mrs. Gillian ShephardIt is accepted that the change in rate will involve some additional and unavoidable compliance costs for business, but there is no readily available means of estimating them. However, these one-off costs should be viewed against the impact of the Budget as a whole, which is to reduce the burden which the tax system imposes on business.
§ Mr. MorleyTo ask the Chancellor of the Exchequer whether he will give the average extra cost per person per year of the extra 2.5 per cent. VAT announced in the Budget to(a) people in the Glanford and Scunthorpe constituency and (b) the national average.
§ Mrs. Gillian Shephard[holding answer 29 April 1991]: Information is not available that would permit us to estimate the extra cost per person in the Glanford and Scunthorpe constituency.
The extra yield in a full year of the VAT increase is £5.5 billion and the population is around 57 million—this suggests an average cost of £96 per person.