Albert Owen
Main Page: Albert Owen (Labour - Ynys Môn)Department Debates - View all Albert Owen's debates with the HM Treasury
(10 years, 3 months ago)
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Albert Owen (Ynys Môn) (Lab)
It is a pleasure to follow the hon. Member for Totnes (Dr Wollaston). I, too, congratulate the hon. Member for South Down (Ms Ritchie) on an excellent introductory speech. I know that we are time-limited, so I will concentrate on some items local to my area and on general issues. As both speakers have said, VAT is a consumer tax that impairs employment opportunities, so it is in many respects a tax on jobs. The Government claim, quite rightly, that they want to eradicate the deficit, but they have chosen the wrong tax to increase, because it has a negative effect on jobs and the economy. In the United States, where there has been fiscal stimulus, the economy has grown much more quickly since the recession than in this country.
VAT has an impact on jobs directly and on the tourism sector in particular, and not only the journals of the hospitality industry are saying that: The Daily Telegraph, which is not a left-leaning paper by any stretch of the imagination, has said that VAT
“is forcing many businesses into a tight corner.”
VAT is hurting small businesses, and as a consequence, it is affecting the number of jobs that could be created.
The tax take is being unfairly concentrated on small and medium-sized businesses. We are seeing a 19% increase in VAT on small businesses at the same time as large corporations are experiencing a decrease in the tax taken from them by the Treasury. We need to even out that situation.
The suggestion made in this debate—including by the hon. Member for South Down, who secured it—to reduce VAT on tourism is a sensible one. Tourism is one of the fastest growing global industries, and we live in a global time, as the hon. Member for Totnes suggested. My area has a link with the Republic of Ireland, which is only two hours away, and many tourists who come to north-west Wales “do Europe” and they can compare the prices in Britain with those in other countries in the European Union. That is true in my area, to the south and west of us—Pembrokeshire is also close to the Republic of Ireland—and in the south-east of England, which is close to France and the rest of the continent.
I represent Ynys Môn, the Isle of Anglesey, and the area is very proud of its tradition of drawing many people from across the world. We need to help tourism businesses. In the short time that I have left to speak, I will highlight the experience of one business, whose owners have written to me. At the moment, their business is just below the VAT threshold. They want to invest in the local economy and local people, but they cannot do so because they are inhibited by the fact that they would face a 20% hike in VAT if they choose to go above the threshold.
VAT is a tax on jobs and it can be reduced. People right across the United Kingdom want a fair and level playing field for our tourism and hospitality industries. Reducing VAT is a simple measure that could achieve that level playing field.
I finish by saying to colleagues who represent areas that are being flooded that the UK is a great destination and that it is open for business. The heart of the British Isles is Ynys Môn, the Isle of Anglesey, but the rest of Britain would also benefit from a policy of reducing VAT.