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Mr. Tam Dalyell (Linlithgow): Were he so minded, the Home Secretary could legitimately answer my question by saying, "Easier said than done." Although I do not doubt that the detection equipment for forgeries is now formidable, what about the forgers themselves? Are not some people making a mint of money out of forgery? What effort is being made with Governments in the far east or elsewhere to get at the root of those who are doing the forging, who are making enormous and odious profits?
Mr. Blunkett: Easier said than done, indeed, but I will give my hon. Friend a more comprehensive answer than that. The commitment to joint intelligence working is a step in the right direction to get people to acknowledge that there is a worldwide problem and that people will go to whatever expertise is available anywhere in the world to obtain fraudulent documents. Therefore, it is a common problem.
The European Union in the form of the Justice and Home Affairs Commissioner, and his equivalent in the United States, are committed to working with individual Governments on finding a way around the problem.
We will need to adopt more secure methods, in addition to the passport control measures, to establish that we are part of the strengthened system, which in future will include biometric techniques. Otherwise, it is almost certain that the United States will reintroduce visas.
Mr. George Foulkes (Carrick, Cumnock and Doon Valley): You will recall, Mr. Speaker, that on Monday I asked my right hon. Friend the Prime Minister whether he would ensure that security measures at Sangatte freight depot are speeded up. Naturally, I am delighted that my right hon. Friend the Home Secretary is back so quickly—it makes me feel that I have more power on the Government Back Benches than I ever had on the Government Front Bench.
Unlike my hon. Friend the Member for High Peak (Mr. Levitt), I had assumed from my right hon. Friend's statement that EWS and other freight operators would be able to run normal services after 31 July, when the security measures will be in force. Will my right hon. Friend confirm that that is his expectation? When he meets his counterpart in July, will he ensure that all the work is on schedule, because in the past there has been some slippage?
Mr. Blunkett: I will do my utmost, here and elsewhere, not to claim deadlines, timetables or success where they do not exist. I indicated that double fencing and security personnel measures will be in place by the end of July. That will substantially improve the ability of EWS to run its services, but the electronic and surveillance measures inside the terminal will not fully complement the external security until September; only then will we be able to guarantee the substantial turnround that has been achieved at Coquelles.
I agree entirely with my right hon. Friend's second point. I am extremely pleased that his intervention earlier this week was so successful.
Dr. Julian Lewis (New Forest, East): Following the suggestion of the Father of the House about focusing on the forgers, does the Home Secretary think that there is potential for the security and intelligence services to try to infiltrate the lines of illegal immigration, so that people inside the system can, as it were, expose it from the inside? I appreciate that at present terrorism is their top priority, but surely that would be one way of exposing what is going on and discovering who is organising it.
Mr. Blunkett: Yes, I do. I was deeply impressed when I went to see Operation Reflex yesterday. Every agency, including the security agencies combined, were working in unison and with their equivalents in Europe and elsewhere, precisely to try to bring that sort of expertise to bear. Given that the traffickers are organised in a $12 billion business, and given that the misery it causes is so great, we are justified in allocating even greater resources to our endeavour.
Mr. Jon Owen Jones (Cardiff, Central): In addressing the pull factors, does my right hon. Friend agree that it is important that we should have a reliable and compatible system that identifies who is in the country and ensures that those who apply for employment, education or other benefits are truly entitled to do so?
Mr. Blunkett: This very interesting question will be addressed next month in the consultation document on
entitlement cards. I have given an undertaking, both publicly and in Government, that that will deal with the pros and cons of such a card. I am absolutely certain that the issue of proper and acceptable identification for employment purposes will form one of the pros, rather than one of the cons.
Mr. Roger Gale (North Thanet): I apologise to you, Mr. Speaker, and to the House for the fact that preparation for a Select Committee hearing prevented me from hearing the question from my right hon. Friend the Member for West Dorset (Mr. Letwin), to whom I add my congratulations, and the Home Secretary's answer, but modern technology enabled me to hear all the exchanges in my own office.
Mr. Speaker: Order. The hon. Member must be in the Chamber to hear statements. I therefore cannot call him. I thank him for listening to the exchanges, but I must put it on the record that hon. Members must be in the Chamber to hear the statement, not listening on a monitor.
Mike Gapes (Ilford, South): My right hon. Friend is aware that the geography of France is very different from that of the UK. France has borders with a large number of countries. Did my right hon. Friend have an opportunity to discuss what the French Government are doing to secure their borders with their other neighbours, and what might happen in future as desperate or gullible people still try to come to this country? Are the French Government prepared to start thinking about their eastern and southern borders?
Mr. Blunkett: My hon. Friend is right to say that the eastern and southern borders of France are extremely important. That is why discussions both at the Justice and Home Affairs Council and in Seville concentrated on that wider issue, including questions around accession countries. There is a much broader issue of collaboration on border control and surveillance, and on the unified handling of those who clandestinely enter the European Union. The French Government are interested, but I will not speak for them; they can speak for themselves about acquiring the technology that I described this afternoon. I hope that British companies will be able to benefit from that.
Points of Order
4.7 pm
Mr. Bernard Jenkin (North Essex): On a point of order, Mr. Speaker. As the question of the immunity of British, American and other forces operating abroad on peacekeeping duties has become a bone of contention between the United Kingdom and the United States in the United Nations, threatening the continuation of the UN peacekeeping mandate in Bosnia, I raised the issue on Thursday last week and asked the Secretary of State for Defence about it. He said:
- "On the ICC"—
- "the Government negotiated an effective immunity for British forces . . . Obviously, that degree of immunity is available to any country that chooses to sign the treaty."—[Official Report, 20 June 2002; Vol. 387, c. 413.]
- "Immunity is not quite the right word."
Mr. Speaker: That is a matter for the Secretary of State; it has nothing to do with the occupant of the Chair.
Mr. Roger Gale (North Thanet): On a point of order, Mr. Speaker. On Monday, during his statement following the Seville summit, the Prime Minister indicated in response to a question from me that the Sangatte protocol, which is directly relevant to the statement that we heard earlier, was overtaken by the introduction of the Dublin convention. My understanding is that the Sangatte protocol was signed following the Dublin convention and in the light of the effects of the Dublin convention, and therefore takes precedence over it. That being so, and the Prime Minister being aware of that, have you had a request from the Prime Minister to correct his statement?
Mr. Speaker: Those are matters that the hon. Gentleman will have to put to the Prime Minister. I chair the proceedings of the House of Commons; I do not answer questions on various protocols.
Indirect Taxes (Disclosure)
4.9 pm
Mr. Mark Hoban (Fareham): I beg to move,
- That leave be given to bring in a Bill to require retailers to include on receipts the amount of VAT and excise duties paid on goods and services purchased.
If the revenue raised were trivial, it would not matter too much how much we paid. It would be of no consequence to us, as a few pence here and there would not make much difference. However, the amount that we pay through such taxes is not trivial. This year's Red Book shows that the outturn for indirect taxes for 2001–02 is as follows: VAT, £61.1 billion; fuel duties, £21.9 billion; tobacco, £7.8 billion; spirits, £1.9 billion; wine, £2 billion; and beer and cider, £3 billion—a total of £97.8 billion. In comparison, the yield for income tax in the same year was £110.2 billion, so VAT and other indirect taxes raise almost as much as income tax. As I said, everyone knows how much income tax they pay, but how many people realise that they are paying almost as much through VAT and other indirect taxes?
The cost of VAT and other taxes soon mounts up. Let me give a few examples. An England fan watching the match last Friday and wearing a £30 England top would have paid £4.46 in VAT for the top. The tax on the four cans of beer that he might have drunk during the match—costing, say, £4—would be £1.20. If he decided, having heard the result, to drown his sorrows in a bottle of whisky costing £14, he would have to pay £8.50 in tax.
As another example, The Grocer, a retail trade magazine, has a standard shopping basket called "The Grocer 33". In the 15 June edition of the magazine, the cheapest shopping basket containing the 33 items featured was £38.67, of which £5.83 went to the Chancellor in a combination of VAT and excise duties. More than 15 per cent. of the amount paid at the till went straight to the Exchequer.
How many people know that a litre of petrol costing 74.6p includes duty of 46p and VAT of 11p? Refuelling a family car with a 40-litre tank will benefit the Chancellor to the tune of £22.80. At the time of the petrol tax protests a couple of years ago, people knew how much they were paying, but memories have faded. The Bill would ensure that every time people filled up they would know just how much they were paying the Chancellor in taxes.
As those examples show, VAT and other duties mount up quickly, but such taxes have another aspect that we need to consider. I believe that indirect taxes are a form
of stealth tax, because no one knows how much tax they are paying to the Treasury every time they make a payment. When a tax is taken by stealth, people cannot assess the true cost to them of the services that the Government provide. Of course, that is in the Government's interests—it is far better to raise taxes by stealth than take tough decisions on spending priorities. It is far better to extract the money in taxes from the purse or the wallet, where it is mixed up with the price of a bottle of wine or a litre of petrol, than to take it from the pay packet, where the tax paid is all too visible. It is far better to add the tax to the price of goods, so that retailers take the blame for price increases. We need to remove that opportunity for the Government to disguise the amount of tax that they raise from our spending.If people do not know how much tax they pay, how can they judge whether they are getting value for money for the services that they receive? If their perception of the amount of tax that they pay is based solely on the amount that is taken from their pay packet, what reaction will they have when they realise that they are paying almost as much again through indirect taxes? Making sure that taxpayers know how much indirect tax they are paying in total would change the dynamic of the relationship between taxpayers and the Government. A greater awareness of the cost of services would lead to people giving much more thought to value for money. More people, whether their taxes are taken through their pay packets or through their spending, would question decisions on how money had been spent—the true cost of Government would become known. How much more dissatisfied would people become with failing public services when they realised that those services were costing them twice as much as they thought?
Another group of people—those who pay no income tax at all—would realise the extent of their contribution to the state. They would know how much tax they were paying towards Government services. Those on benefits would see how much of their income they have, in effect, paid for themselves through indirect taxes extracted through their weekly shopping and other spending. To use a biblical allusion, even the widow would see how much of her mite the Chancellor was taking.
In an ideal world, we would receive a statement setting out the taxes that we have paid—both direct and indirect—so that we could see at a glance the tax burden that each of us suffers personally. I readily accept that that is impractical, but we can progress towards the goal of increasing the transparency of our personal tax burdens by requiring those who supply us with goods and services to give us receipts telling us how much tax we have paid on our shopping, whether it is for food, drink, electrical goods or petrol. Every time we bought something, we would know straight away how much of what we had paid the retailer or the publican would go to the Government. It would be a powerful jolt to each of us if we knew that most of the price of a bottle of wine was going to the Chancellor; perhaps we would stop and think about whether we were getting value for money. That is what they do in the United States. Every receipt shows the amount of sales tax that one has paid. Perhaps that is one reason why people in the US are much more conscious of the taxes that they pay and why taxes may be lower. People who know how much tax they have paid are more likely to hold the Government to account, so the pressure
to restrain spending growth and to ensure that each pound of tax is spent wisely is great. We should perhaps learn that lesson from the United States.This is a simple measure that I hope and believe would change the political climate. Politicians would find it less tempting to increase indirect taxes rather than income tax because people would be able to see the increase every time they paid for their shopping. Realising the full extent of their tax bill, voters would challenge the Government on value for money. Everyone would be able to understand the price that they pay for the Government services that they receive and to decide whether they are getting value for money.
It is time to lift the lid on taxes so that we can have a proper debate about how much we pay and the value that we get. Ensuring that we know how much VAT and other indirect taxes we pay on goods would be the start of that process.
Bill ordered to be brought in by Mr. Mark Hoban, Dr. Andrew Murrison, Mr. Hugo Swire, Mr. Mark Field, Mr. John Baron, Mr. Mark Francois, Mr. Mark Simmonds, Mr. David Cameron, Chris Grayling, Mr. George Osborne, Mr. Paul Goodman and Mr. Peter Duncan.
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