Previous Section Index Home Page


Inflation

Mr. Malcolm Bruce: To ask the Chancellor of the Exchequer what adjustment mechanism will be available to the Treasury for public expenditure in circumstances when inflation outturns diverge substantially from Treasury planning assumptions; and if he will make a statement. [46382]

Mr. Darling [holding answer 18 June 1998]: I refer the hon. Gentleman to Section 3.4 of the EFSR (CM 3978).

Capital Gains Tax

Mr. Malcolm Bruce: To ask the Chancellor of the Exchequer (1) if he will estimate the cost of introducing taper relief for capital gains tax for each year up to 2009-10; what margin of error is associated with such estimates; what assumptions underlie such estimates; and if he will make a statement; [46768]

Dawn Primarolo [holding answer 22 June 1998]: The available information on the effect on Exchequer revenues of the capital gains tax package of reforms is as follows:

Year£ million (+) yield/(-) cost
1998-99Negligible
1999-2000-25
2000-2001+25

For later years, the Exchequer effects will depend to a considerable extent upon movements in future asset prices, any behavioural changes and other factors. In the long term the aim is for the changes to be broadly revenue neutral. It is inappropriate to estimate the cost of taper relief in isolation from other elements of the reform package.

The assumptions for inflation and asset price growth used in calculating the revenue effects of these measures are consistent with the economic assumptions referred to on pages 108 and 109 of the March 1998 "Financial Statement and Budget Report" (FSBR, HC620 published on 17 March 1998). Equity prices are assumed to grow at the same rate as gross domestic product (GDP) at current market prices--"money GDP".

Mr. Malcolm Bruce: To ask the Chancellor of the Exchequer if he will delay the implementation of capital gains tax taper relief for a period of one year to allow for further consultations on its effects and implications; and if he will make a statement. [46770]

23 Jun 1998 : Column: 451

Dawn Primarolo [holding answer 22 June 1998]: No. It is important that the benefits of the reforms flow through as early as possible.

The hon. Gentleman's amendments to the Finance Bill on this matter was discussed by a Committee of the Whole House on 29 April and rejected in a vote.

Mr. Malcolm Bruce: To ask the Chancellor of the Exchequer which Ministers were involved prior to the March 1998 Budget in formulating the new policies on capital gains tax, including the taper relief on capital gains tax; and if he will make a statement. [46769]

Dawn Primarolo [holding answer 22 June 1998]: The Chancellor is responsible for all Budget measures. He receives advice from his Ministerial team and officials as appropriate.

Mr. Malcolm Bruce: To ask the Chancellor of the Exchequer how many written representations he has received on his 1998 Budget proposals on taper relief for capital gains tax; how many of such representations were (a) favourable and (b) unfavourable; and if he will make a statement. [46767]

Dawn Primarolo [holding answer 22 June 1998]: Around 200 comments were received on the Budget proposals, of which approximately 80 mentioned taper relief. Seventy per cent. supported the principle of taper relief. There were varying comments on the detail.

Tax (Hypothecation)

Mr. Corbyn: To ask the Chancellor of the Exchequer what plans he has to extend hypothecation of tax revenue beyond Welfare to Work. [46774]

Mr. Darling [holding answer 22 June 1998]: We look at each case on its merits. The Economic and Fiscal Strategy Report (Cm 3798) announced (on Page 28) that departments would be able to keep some levies and similar taxes, netting them off the Departmental Expenditure Limits where this would further the Government's economic objectives and not prejudice spending plans and priorities.

Current and Capital Expenditure

Mr. Heathcoat-Amory: To ask the Chancellor of the Exchequer what criteria he will use to distinguish between current and capital expenditure. [46850]

Mr. Darling [holding answer 22 June 1998]: For the purpose of assessing the surplus on the current budget, the Government use national accounts definitions of current and capital expenditure except, as set out in paragraph B53 of the March 1998 "Financial Statement and Budget Report" (FSBR), that depreciation is treated as current expenditure.

When the new European System of Accounts (ESA95) is brought into effect later this year, national accounts will treat depreciation as current expenditure and so these expenditure measures will align.

Vehicle Excise Duty

Mr. Green: To ask the Chancellor of the Exchequer what plans he has to bring vehicle excise duty on heavy goods vehicles into line with average levels in other European Union countries. [46550]

23 Jun 1998 : Column: 452

Dawn Primarolo [holding answer 22 June 1998]: None. In the last Budget, 17 March 1998, Official Report, column 1109, the Chancellor announced a review of the system for setting vehicle excise duty rates for lorries to ensure that the environmental damage caused by lorries is reflected in their vehicle excise duty rates.

Vehicle Taxation

Mr. Jenkin: To ask the Chancellor of the Exchequer what is his latest forecast of the revenue from (a) VED, (b) fuel duties on petrol and derv and (c) the total of VED and fuel duties in (i) the current financial year and (ii) each of the subsequent two years. [46772]

Dawn Primarolo [holding answer 22 June 1998]: The table gives the figures requested. The forecasts are consistent with the figures for total tax receipts published in the Economic and Fiscal Strategy Report.

Forecasts of receipts from vehicle excise duty and hydrocarbon oil products

£ billion
1998-991999-20002000-01
Vehicle excise duty4.64.74.8
Hydrocarbon oil products21.423.325.6
Total26.028.030.4

Education Spending

Mr. Maude: To ask the Chancellor of the Exchequer what was the average annual real terms percentage increase in public spending on education in the UK between 1979-80 and 1997-98. [46461]

Mr. Darling: 1.6 per cent.

Pensions Mis-selling

Mr. Kidney: To ask the Chancellor of the Exchequer what assessment he has made of the possibility that the form of the phase 2 pensions mis-selling inquiries proposed by the Financial Services Authority will invalidate independent financial advisers' professional indemnity insurance. [46804]

Mrs. Liddell: That is a matter for the Financial Services Authority.

Diesel Duty

Mr. Gordon Prentice: To ask the Chancellor of the Exchequer what assessment he has made of the impact of divergence in diesel duty rates across the EU on United Kingdom competitiveness. [46576]

Dawn Primarolo: Diesel duty rates in other Member States are one of many factors assessed in determining the level of UK rates. This assessment has resulted, in the last Budget, in a package of measures which reflects the Government's commitment to the environment and to promoting a more dynamic business sector.

The Government are committed to achieving their share of the EU target, to reduce greenhouse gas emissions by 8 per cent. by 2008-2012. The commitment to increase road fuel rates by at least 6 per cent. on average in real terms each year reflects this. In addition, the Government intend, over time, to adjust the structure of duties on road

23 Jun 1998 : Column: 453

fuels to move towards a fairer treatment of unleaded petrol and diesel, when calculated on an energy or carbon basis, and to encourage diesel users to switch to cleaner ultra-low sulphur diesel.

Heavily Indebted Poor Countries

Mr. Cash: To ask the Chancellor of the Exchequer, pursuant to his answer to the right hon. Member for Hitchen and Harpenden (Mr. Lilley) of 18 May 1998, Official Report, column 291, if he will list by country the value of the outstanding debts on (a) United Kingdom aid loans and (b) loans guaranteed by the British Government through the Export Credits Guarantee Department, for each of the countries defined by the World Bank as severely or moderately indebted; and if he will give equivalent figures for (i) Afghanistan, (ii) Cuba, (iii) Gibraltar and (iv) Iraq. [44998]

Mrs. Liddell: The values of the outstanding claims held by ECGD and DFID, on all of the countries identified by the World Bank in Global Development Finance 1998 as moderately or severely indebted low income countries, are listed in the table. The table also includes the figures for Afghanistan, Cuba, Gibraltar and Iraq. The figures for ECGD's claims give the value of the outstanding principal of the loans at end-1997. The figures for DFID's claims give outstanding principal and interest and are current at end May 1997.

£ million
CountryValue of ECGD's export credit claimsValue of DFID's claims
Afghanistannilnil
Albanianilnil
Angola91.2nil
Bangladeshnilnil
Benin2.7nil
Bhutannilnil
Bolivia17.5nil
Burkina Faso1nil
Burundinilnil
Cambodianilnil
Cameroon61.50.07
C.A.R.0.5nil
Chadnilnil
Chinanilnil
Comoros0.04nil
Congo-Brazzaville123nil
Cote d'Ivoire30.5nil
Cuba51.2nil
DR Congo (ex Zaire)129.4nil
Equatorial Guineanilnil
Eritreanilnil
Ethiopia11.7nil
Gambianilnil
Ghana3.5nil
Gibraltarnilnil
Guinea5.1nil
Guinea-Bissaunilnil
Guyana44.2nil
Haitinilnil
Honduras0.36nil
India1.69.8
Iraq650nil
Kenya43.5nil
Laosnilnil
Liberia14.50.08
Madagascar27nil
Malawi0.7nil
Mali4.1nil
Mauritania7.1nil
Mongolianilnil
Mozambique86.3nil
Myanmar25nil
Nepalnilnil
Nicaragua1nil
Niger10.8nil
Nigeria3,1004.9
Pakistan0.68nil
Rwandanilnil
Sao Tome et Principenilnil
Senegal2.9nil
Sierra Leone3.5nil
Somalia27.5nil
Sri Lanka4,000nil
Sudan404.8nil
Tanzania125.7nil
Togo14.2nil
Uganda14nil
Vietnam10.4nil
Yemen6.2nil
Zambia234.1nil
Zimbabwe0.112.7

23 Jun 1998 : Column: 454


Next Section Index Home Page