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Personal Taxation

Volume 129: debated on Thursday 10 March 1988

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6.

To ask the Chancellor of the Exchequer what proportion of earnings of a married male on average earnings with a non-working wife and two children were taxed by (a) income tax, (b) national insurance contributions, (c) value added tax, (d) other indirect taxes and (e) domestic rates, in 1979 and 1987.

I refer the hon. Gentleman to the answer I gave to my hon. Friend the Member for Hornchurch (Mr. Squire) on 18 December 1987.

I thank the right hon. Gentleman for that answer. Does he agree that tax incentives are now overdue after the promises given in two general elections? Will we soon see those tax incentives? Does he also agree that the vast majority of people would rather see some incentives put into the National Health Service and into small businesses?

I note what the hon. Gentleman says and that he is singing a very different tune from the one that his party sang last year. He will understand that I cannot anticipate my right hon. Friend's Budget.

Does the question imply that taxation should be lowered? Does my right hon. Friend expect the Liberal party to support any forthcoming tax cuts, or does the hon. Member for Southport (Mr. Fearn) represent a separate Southport branch of the Liberal party?

That seemed to be the clear implication of the hon. Gentleman's question and, as I said, there seemed to be a very different approach last year.

It might be more useful to examine the Government's position rather than the Liberal party's position. In a very helpful written answer, the Financial Secretary told the House on 28 January that in the last year of the Labour Government total tax and national insurance contributions were 33ยท8 per cent. of the gross domestic product, yet between 1981 and now the same figure has averaged well over 38 per cent. In those circumstances, how can the Government claim that the Conservative party will give people more say over their spending decisions?

I note the hon. Gentleman's very interesting intervention which, again, clearly seems to be a plea for reduced taxes, which I note.