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Tax Paid: Reductions

Volume 658: debated on Tuesday 9 April 2019

This Government have made very significant progress in reducing the burden of taxation on the low paid, including by recently increasing the personal allowance to £12,500—thus taking 1.7 million of the lowest paid out of tax all together since 2017.[Official Report, 11 April 2019, Vol. 658, c. 5MC.]

What the Treasury gives with one hand, local authorities are taking away with the other, with relentless rises in council tax, and parking charges and fees affecting households up and down the country. What are we actually doing to help families, instead of paying them lip service?

My hon. Friend makes the important point that there are many costs and taxes that bear down on the lowest paid. That is why, in addition to increasing the personal allowance, the Conservatives have introduced the national living wage, which has gone up well above the rate of inflation this April. We have frozen fuel duty for nine years in a row, which has saved the average car driver £1,000 cumulatively. We should also not forget that 28% of all income tax is paid by just the highest 1% of earners.

The Minister can say anything he likes, obviously. In fact, he knows that the tax system is skewed in favour of richer people. The poorest 10% pay 42% of their income in taxes, whereas the richest pay 34%. Does he have any plans to achieve greater parity, particularly in VAT?

I am surprised that the hon. Lady should mention the level of tax paid by the most wealthy, because under this Government, as I have just stated, the highest-earning 1% pay a full 28% of all income tax. Under the last Labour Government, that figure was substantially lower at around 24%.

Does the Minister agree that taxes could be lower if spending was better controlled, yet this House provides no scrutiny of spending whatsoever? The supply and appropriation Bill that he presented just over a month ago was not debated or voted on. Is it not time that, like other Parliaments, we had a Budget committee and a parliamentary Budget office to scrutinise spending and hold Government properly to account?

My right hon. Friend the Chief Secretary has just appeared before the Procedure Committee to address just the issue that my hon. Friend raises.

Given that our social care system is breaking, causing indignity, poverty and hardship to millions of people in their old age, might it be time to consider increasing fair taxes, so that we can live in a civilised society that looks after its most vulnerable people?

As the hon. Gentleman may know, £400 million went into social care just at the last Budget. It is the mission of this Government to get taxes as low as possible so that we have a strong economy. Our record is good: we have about the highest level of employment in this country’s history, more women are in work than at any time in our history, and we have halved unemployment since the mid-1970s. All of that is about creating the wealth and the money to make sure that we can afford the public services that the public expect.