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Sir Terence Higgins (Worthing): The right hon. Gentleman keeps chuntering on about 22 tax rises, which include many items that no one in their right mind would regard as a tax increase. The most that he could accumulate by way of an increase was a total of something like £2 billion. Would the windfall tax raise more than that or less?

Mr. Brown: The windfall tax is not a tax on ordinary families. VAT is a tax on ordinary families; national insurance is a tax on ordinary families; withdrawing mortgage tax relief is a tax on all this country's families; cutting the married couple's allowance is a tax on ordinary families. If the right hon. Gentleman, for whom I have a great deal of respect from his days in the Treasury Committee, would like me to do so, I should be happy to read into the record the 22 tax rises since 1992.

As a result of the Budget, the tax burden has risen, not fallen. When people throughout the country understand that that is the truth, they will never trust the Tories again. One does not need to look in Labour's press releases to find that out. All one needs to do is look at the Red Book

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itself--what the Chancellor published yesterday afternoon. Page 147 of the Red Book shows taxes up at £1,085 million and taxes down at £735 million, giving a total tax rise of £350 million. That is all on pages 146-47 of the Red Book. I know that the Chancellor did not read the Maastricht treaty, and he is now looking at the Red Book. I shall be happy to give way to the Chancellor later, if he wants to point out that what I have said is not the truth.

Sir Peter Fry (Wellingborough) rose--

Mr. Brown: The Chancellor now needs Back Benchers to speak up and answer the questions for him. I shall give way to the hon. Gentleman.

Sir Peter Fry: If one follows the right hon. Gentleman's argument thus far--that the Budget includes many tax increases--it appears that, if he were being totally honest, he should advise his hon. Friends to vote against the reduction in income tax that the Chancellor announced yesterday.

Mr. Brown: I will not, and nor will any Labour Member, take lessons on honesty on taxation from Conservative Members. I am grateful to the hon. Gentleman for intervening, because it gives me the chance to remind him of something that his constituents will remind him of at the next election--what he said in his election manifesto. I shall quote it because he may want to repeat it, on the ground of honesty, in his 1997 manifesto. It said:


When the Chancellor has read page 147 of the Red Book, perhaps he will also look at page 80. The total tax burden for this year is 37.7 per cent. Will it rise or fall next year? It will rise to 38 per cent., to 38.1 per cent. the year after that and to 38.5 per cent the year after that. And this is the Government who promised to cut taxes year on year. This Budget, which was to restore their reputation as tax cutters--

The Chief Secretary to the Treasury (Mr. William Waldegrave) rose--

Mr. Brown: Ah.

Mr. Waldegrave: I think the right hon. Gentleman has the wrong page--he means page 88. If he looks at that page, he will see that it confirms that the tax and national insurance contributions burden, going into the next election, will be lower than the tax and NIC burden going into the previous election.

Mr. Brown: The right hon. Gentleman might wish to look at that again. Non-North sea oil taxes and NICs were 34½ per cent. of national income for 1992-93. For next year, 1997-98, they will be 36¼ per cent.

Mr. Waldegrave: The right hon. Gentleman has now changed the base year. The comparison used by the leader of the Labour party was the year going into the election, which was 1991-92.

Mr. Brown: I do not know whether the right hon. Gentleman remembers the circumstances in which we

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fought the previous election, but the Government announced their Budget before the election. For 1992-93, they announced their position on total taxes and national insurance--I shall use the other table now--which was that 34¼ per cent. of national income would be taken in tax. What is the position next year? The table shows 36¼ per cent. Once again, we see a Government who say at the election that they will cut taxes and who then eventually raise taxes. We now find that last year's Budget, which was in truth a tax-cutting Budget, was merely the interval between one tax-raising Budget and another. The Government raised taxes in recession and blamed the recession: they are now raising taxes in recovery, but who will they blame this time?

The Chancellor of the Exchequer (Mr. Kenneth Clarke): About five of the 22 tax increases that the right hon. Gentleman mentioned are increases in tobacco taxation, to which we are committed. Some of our future commitment to raise taxation is a commitment to continue to raise the tax on tobacco in real terms. The Labour party supports that--I think--or has it not yet made up its mind? Perhaps tax on tobacco is like the windfall tax and eventually we shall get a decision on it.

Mr. Brown: I am grateful to the Chancellor for intervening and allowing me to explain the 22 tax rises listed in our document. It might pay the Conservatives to look at that document, because they will see the full damage of what they have done. The allowances and taxes affected include personal tax allowances; married couple's allowances; fuel duties; mortgage interest relief; VAT on domestic fuel; insurance tax, at 2½ per cent.; airports tax; and supplementary budget increases. Are not those taxes that hit ordinary people?

Mr. Clarke: I shall not try to get the right hon. Gentleman to say which of those he would repeal or how many of the allowances he would restore, but I asked him about tobacco taxation. He knows that many of the tax increases that he is complaining about are increases in the tax on tobacco, and he knows that the future projections include a commitment to a real terms increase in the tax on tobacco. Half his party complains about the inadequacy of the tax that we are imposing on tobacco. What is the right hon. Gentleman's position on that and why is he complaining about it?

Mr. Brown: That is interesting to hear from the Chancellor. I read out the list, which does not include tobacco duties, and he then stands up and says that it does. I shall tell him: it does not include tobacco duties. He asked me whether the list included any tax that we would reduce and I shall tell him. We will bring down VAT on fuel.

After yesterday's Budget, what will Conservative Members, very few of whom have dared to appear after yesterday, tell--

Mr. Nirj Joseph Deva (Brentford and Isleworth) rose--

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Mr. Brown: I shall give way once more, but then I must move on.

Mr. Deva: If the right hon. Gentleman is so concerned about tax increases, can he tell us by how much he proposes to increase tax through his utilities tax?

Mr. Brown: The hon. Gentleman allows me to remind him of what he said to his electors at the previous election, for which he will have to answer. We have made the situation clear on our utilities tax. We will consult the regulators and we will announce the details in a Labour Budget and, after yesterday, the sooner we have that Budget, the better. The hon. Gentleman might have a more difficult time explaining himself to his electors at the next general election. He should be reminded of what he said in his election manifesto, because he will have to answer for it. He said: "Taxes will be reduced." Some 22 tax rises later, what will he say to his local newspapers and his constituents in Brentford and Isleworth?

Let us remember the commitments on which the Conservatives entered the general election campaign. They said--I quote the Prime Minister--


What happened? The Government did not cut VAT yesterday. They actually extended it to travel insurance and television rental insurance, to raise hundreds of millions of pounds more.

Let us remember the argument that was used when the Conservatives introduced VAT on fuel. They said that it had to be introduced because of the unforeseen consequences of recession. We are now in recovery, as the Chancellor keeps telling us. He had the chance to mitigate the damage that had been done and to undo at least some of it. But when Conservative Members waved their Order Papers yesterday to applaud the Budget, they were applauding a Budget that chose to leave VAT on fuel at 8 per cent., and that is the most unpopular and unfair tax in the country. They were also applauding a Budget that will extend VAT again.

So there is no doubt about the public's suspicion of a Chancellor and a Government who repeatedly said before the general election that they would not extend VAT, but who continued even yesterday to do so by hundreds of millions of pounds. The Chancellor will have to go into the election explaining his personal views that he would like to see VAT imposed on food, on travel, on books and newspapers and on children's clothes. That is the Chancellor's personal position, and that is what he will be asked about throughout the campaign.

Let us remember the campaign that was fought on national insurance at the previous election. The Labour party's tax bombshell was that we would remove the national insurance ceiling. Labour, the Conservatives said, would raise national insurance charges for those earning above £20,000. What happened? What did the Conservatives do? They raised national insurance for everyone. The Prime Minister's promise was that he

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would not raise the rate of national insurance, and then he increased it to 10 per cent.

Those increases are not slips, unfortunate accidents or unforeseen consequences that can be wished away as lapses. They are part of a systematic deception of the British public. The Conservatives' promise on national insurance was broken, as was their promise on VAT, because they did not create an economy that was sufficiently successful to deliver the lower tax burden that they promised.

The House may remember the Government's "help for families". The Chancellor talked about families yesterday, and mentioned the married couple's allowance. The Conservatives fought the 1987 election saying that Labour would abolish it, but which party will go into the election as the one that cut the married couple's allowance? Not Labour--it is the Conservative party. The Chancellor confirmed yesterday that, after the Budget, the married couple's allowance will stand at 15 per cent.--another Tory tax rise.

What of mortgages? The Tories say all the time that Labour would cut help with mortgages, but which party did so in this Parliament? None other than the Conservatives. The House should remember their manifesto commitment--the Prime Minister said that they would maintain mortgage tax relief. But after yesterday's Budget, mortgage tax relief will still be withdrawn. Once again, the Conservatives will go into the election having cynically broken a promise.

What of the overall tax burden since 1992? The Chancellor--who has intervened in the past few minutes on this--went round the television studios this morning, and was asked a fairly innocuous question on GMTV. "Is the ordinary family taxed more than in 1992?" he was asked. I heard him say, "I am not sure." With all the authority of the Treasury and its briefing documents behind him, he said that he was "not sure".

Later, the Chancellor went on "Today", and seemed to quote me all the time. He was asked by Mr. Humphrys whether tax had risen since 1979. He replied that it depends on whether people smoke, how big a car they have and how far they drive. Then, I gather, he said at a Treasury press briefing at 10.30 am that the question was a "preposterous irrelevance". It is not a preposterous irrelevance that the people of Britain were told that they would have tax cuts year on year and were then let down.

Let me tell the Chancellor about the overall position. Taxes in 1978-79--34.25 per cent. Taxes next year--36.25 per cent. Whichever way one looks at it, taxes have risen under this Government. They have tried to perform the conjuror's trick of drawing attention to the things that they want people to see, while concealing what they do not want people to see. That is the Tories as they are all the time. Before the election, they raise expectations. After the election, they raise taxes.


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