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Economic Crisis (East and South-East Asia)

Dr. Cable: To ask the Chancellor of the Exchequer what assessment he has made of the impact of the East and South-East Asian financial and economic crisis on British GDP growth in 1997-98, 1998-99 and 1999-2000 and on the volumes of United Kingdom exports and imports in those years. [25225]

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Mrs. Liddell: Financial difficulties to date in Asia are not expected to have a major direct impact on the UK economy, but the situation is still evolving and is being kept under close scrutiny.

Self-assessment

Mr. Webb: To ask the Chancellor of the Exchequer what he expects to be the effect in (a) 1997-98, (b) 1998-99 and (c) 1999-2000 on Inland Revenue manpower of the move to self-assessment; and if he will estimate the effect of the change on the running costs of the Inland Revenue. [24714]

Dawn Primarolo [holding answer 22 January 1998]: The move to self-assessment will reduce Inland Revenue manpower by nil in 1997-98, by 1,400 man years in 1998-99 and by a further 1,600 man years in 1999-2000. Once the transitional costs of introducing the system have disappeared, self-assessment is expected to reduce Inland Revenue running costs by around £70 million per annum.

Mr. Webb: To ask the Chancellor of the Exchequer what revenue he expects the Government to receive from £100 fines on taxpayers who file their return after the 31 January deadline. [24715]

Dawn Primarolo [holding answer 22 January 1998]: The Government have not included any specific amount for these penalties in their forecast receipts. These penalties exist solely to deter late filing, and the Government would much prefer that taxpayers file their returns on time than incur penalties for late filing. The normal penalty charge will be £100, but where the tax payable is less than this, the penalty will be reduced to an amount equal to the tax liability.

House Repairs (VAT)

Mr. Chope: To ask the Chancellor of the Exchequer what is the Government's policy towards the proposal of the EU Commission that there should be a three-year trial period during which member states of the EU can impose a 5 per cent. rate of VAT on repairs to domestic housing; and if he will make a statement. [24770]

Dawn Primarolo [holding answer 22 January 1998]: The Commission's suggestion that member states should be able to opt to apply a reduced rate experimentally to certain labour-intensive services has yet to be discussed by the ECOFIN Council, or indeed to be presented as a formal legislative proposal. The Government are carefully considering this proposal. There is, though, little evidence yet to convince us of the usefulness of reduced rates of VAT as a means of increasing employment or assisting small businesses.

The UK has a £49,000 registration threshold for VAT, which already allows a small labour-intensive business, such as a builder doing house repairs, to trade legitimately without charging VAT.

Personal Pension Plans

Mr. Webb: To ask the Chancellor of the Exchequer how many personal pension plans were terminated in 1994-95 by individuals below the minimum pension age

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of the scheme; and how much had been paid into those schemes by the Exchequer in the form of income tax relief on contributions. [25523]

Mrs. Liddell: We do not collect this information.

Economic Indicators

Mr. Malcolm Bruce: To ask the Chancellor of the Exchequer what is his estimate of the percentage increase in the (a) GDP deflator and (b) headline retail prices index in each year from 1986-87 to 1997-98; and if he will make a statement. [24742]

Mrs. Liddell [holding reply 23 January 1998]: Annual average inflation rates for the GDP deflator and the headline retail price index (RPI) are shown in the table. The table also shows figures for the RPI excluding mortgage interest payments (RPI ex MIPs), which is the Government's target measure.

Annual average inflation rates for financial years
Percentage change on previous financial year

Financial yearGDP deflatorHeadline RPIRPI ex MIPs
1986-873.03.23.4
1987-885.34.03.7
1988-896.76.05.1
1989-907.07.86.0
1990-918.09.78.7
1991-926.44.86.1
1992-934.23.14.1
1993-942.91.728.8
1994-951.52.72.4
1995-962.73.32.8
1996-972.82.43.0
Forecast 1997-98(18)2.75(19)3.62.75

(18) Pre-Budget Report forecast.

(19) Calendar year 1997. The Government do not publish forecast for the headline RPI.


For the Pre-Budget Report, the National Audit Office audited the consistency of the assumptions for a range of price indices, including the GDP deflator and the headline RPI, with the projected path for RPI ex MIPs. The Auditory General and Comptroller concluded:


Tax (Advance Clearance Procedures)

Mr. Gibb: To ask the Chancellor of the Exchequer (1) what assessment he has made of the level of staff required to run an advance clearance department at the Inland Revenue in the event of a general tax anti-avoidance provision being implemented; and what estimate he has made of the annual operating costs of such a department; [24848]

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(5) how many staff at the Inland Revenue work on advance clearance procedures; and what was the cost of employing such staff in each of the last three years. [24877]

Dawn Primarolo [holding answers 23 January 1998]: The statutory advance clearance procedures for which details are available of the number of applications, are as follows:

s. 138 Taxation of Chargeable Gains Act 1992s. 215 Income and Corporation Taxes Act 1988s. 225 Income and Corporation Taxes Act 1988s. 707 Income and Corporation Taxes Act 1988(20)
19902,6862091,2064,164
19912,2851901,2243,700
19922,0541601,3483,470
19932,0771851,2163,567
19942,2541911,3993,903
19952,4582271,5654,232
19962,7442271,7564,642
19973,0362731,9585,500

(20) These figures include repeat applications and letters supplying information in support of previous applications.


It is not possible to give precise staff and cost figures for these clearances, as some of the staff involved have other duties, but approximately 15 staff units are presently employed on this clearance work at an approximate pay-bill cost of £500,000 per annum. In response to the hon. Gentlemen's questions about representations received concerning a general anti- avoidance rule, I would refer him to the answer given by the Chancellor of the Exchequer to the hon. Member for Surrey Heath (Mr. Hawkins) on 15 January 1998, Official Report, column 305. It is too early for an assessment to be made of the staffing needs and operating costs of any unit dealing with advance clearances.

VAT

Mr. Baker: To ask the Chancellor of the Exchequer what was the total value added tax income generated from value added tax registered (a) artists, (b) sculptors, (c) designers, (d) authors, (e) journalists and (f) composers for each year since 1993. [24744]

Dawn Primarolo [holding answer 26 January 1998]: The information requested is not available.

IT Equipment

Mrs. May: To ask the Chancellor of the Exchequer if he will make a statement on the Government's policy on the use of framework contracts for the purchase of IT equipment and services by the public sector. [25457]

Mr. Geoffrey Robinson [holding answer 26 January 1998]: Departments and other public bodies are individually responsible for the procurement of goods and services. The Government's policy is that they should achieve value for money, normally through competition. One of the options open to them in the field of IT equipment and services is to make use of framework contracts entered into by CCTA following competitive procurement.

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