Budget Resolutions

Bim Afolami Excerpts

1st reading: House of Commons
Thursday 1st November 2018 Commons Chamber

[Andrew Gwynne (Denton and Reddish) (Lab)]

I beg to move an amendment, after “tax year 2019-20” insert

“provided that the condition in paragraph (2) of this resolution is met.

(2) The condition in this paragraph is that the Chancellor of the Exchequer has, no later than 5 April 2019, laid before the House of Commons a distributional analysis of—

(a) the effect of reducing the threshold for the additional rate to £80,000, and

(b) the effect of introducing a supplementary rate of income tax, charged at a rate of 50%, above a threshold of £125,000.”

We have had the fiction and now it is time for the fact. It is a pleasure to open the final day of the Budget debate for the Opposition. This Budget was sold as ending austerity, but it does not do that remotely. It is a Budget of failure; a Budget of broken promises.

Labour is not opposed to any modest benefit—however modest that may be—for lower and middle-income earners, but that measure is the only one that puts some money in their pockets. We also need to support those who do not reach the lower threshold, which is why we support a real living wage, and the restoration of sectoral collective bargaining and trade union rights. However, putting more money into the pockets of higher earners is obviously wrong, which is why the next Labour Government will increase taxes on only the very wealthiest—people with incomes in the top 5% and the corporations that have had a tax cut under the Tories.

[Bim Afolami (Hitchin and Harpenden) (Con)]

Will the hon. Gentleman clarify what the Opposition would regard as “the very wealthiest”?

[Andrew Gwynne]

The hon. Gentleman was clearly not listening. It is in our amendment and was in our manifesto at the last general election. We mean the people in the top 5% of incomes, and Labour’s amendment sets out the changes to income taxation that we would introduce in order to achieve that.

--- Later in debate ---

[Leo Docherty (Aldershot) (Con)]

I am very pleased to be called to speak in this important debate.

I welcome the Budget very much, especially the cut in business rates, which will have a hugely positive impact on many businesses in my constituency. One such business in Aldershot is the butcher Alf Turner, a long-standing establishment founded in 1956. Madam Deputy Speaker, you will know that it is not only Budget week, but UK Sausage Week. I am pleased to report that Paul Turner, the proprietor of Alf Turner, is a supreme sausage champion, having won the UK Sausage Week award for best traditional sausage. Last night he said to me:

“The cuts to business rates from Monday’s Budget are fantastic news for local family-run businesses like mine. Keeping local shops open can only serve our local communities.”

I draw attention to that because the real point is that Paul’s business is successful not because the Government are helping it, but because the Government are letting it get on with what it does best: making great sausages. It creates a superb product that local people choose to buy and is now available nationally. The lesson is the importance of choice. When freedom of choice is allied with the free flow of capital and labour, and protected by property rights and the rule of law, we have a flourishing free market. That is the great genius of our economy and many economies in the west.

[Bim Afolami]

Could my hon. Friend illuminate the House by saying what he fears would happen to small businesses such as the ones in Aldershot that he mentioned if they were subject to the programme of huge tax rises and nationalisation proposed by Labour?

[Leo Docherty]

I am grateful to my hon. Friend for that intervention. The wholesale economic devastation that would be the consequence of Labour’s nationalisation plan—I do not know whether it has a plan to nationalise sausage production, but I hope not—would be clear. We have to make the case for the free market. In this day and age, it is astonishing that Labour Front Benchers espouse an ideology that totally opposes the free market.

The shadow Chancellor is a self-declared Marxist. The House will know that in 2006 he said:

“I’m honest with people: I’m a Marxist”.

He said of the 2008 crash:

“I’ve been waiting for this for a generation”.

In 2017, he stood in front of Communist flags at a May Day parade in London, and just this year he attended the Marx 200 conference in London, at which he claimed:

“Marxism is about the freedom of spirit”.

--- Later in debate ---

[Bim Afolami (Hitchin and Harpenden) (Con)]

It is a pleasure to speak in the debate. First, I would like to address the measures in the Budget that relate to the digital economy, including the digital services tax. I declare an interest: I am a former corporate lawyer —I was even more fun when I was doing that. Someone who deals with international transactions and contracts learns that international tax treaties are very complicated and were designed for a time before the current technological revolution. The UK Government are leading the way in clamping down on the admittedly difficult and perhaps unsavoury practices of multinational tech firms. Of course, the digital services tax will not deal with that completely, but it is a step in the right direction. As I say, we are one of the first Governments in the world to do anything like this, and I commend it to the House.

Turning to my constituency, I want to address the measures relating to the high street. We all know that the high street has been under significant pressure over the past few years. Whenever I speak to the owners of small independent shops in both Hitchin and Harpenden, they say that business rates are a significant problem, so I look forward to telling them this weekend about the cut of a third in their business rates, if their rateable value is under £51,000. That measure will be of huge benefit to my independent shops and I commend it to the House.

Even more important than the cut in business rates is the £675 million future high streets fund because it will help to enable our local authorities and local areas to take leadership and act on their own initiative to reshape their high streets to deal with the modern world and its challenges. I urge the Chief Secretary to the Treasury, who is sitting on the Treasury Bench, to make sure that this money gets to local councils as soon as possible so that we can get on with making improvements.

[Gareth Johnson (Dartford) (Con)]

Does my hon. Friend agree that the Budget’s tax cuts will also help the high street by ensuring that regular people have more money in their pockets to spend in high street shops, thereby improving the whole economy?

--- Later in debate ---

[Bim Afolami]

I thank my hon. Friend for that intervention. I was coming to tax cuts because, particularly in relation to the high streets, they are a classic piece of positive Conservative economics that will increase demand and help consumer spending, and thereby help the high street. I commend the Chancellor and the Treasury team for putting the policy forward in the Budget.

On tax cuts more broadly, if someone is one of the 1.74 million people who, in only the last two years, the Government have taken out of tax altogether, that side is against them; this side is for them. If someone is one of the 25 million basic rate taxpayers who have saved more than £1,000 in real terms since 2010, that side is against them; this side is for them. If someone has the temerity to want to earn over £50,000—yes, there are people who want to do that—that side is against them; this side is for them. The Budget not only backs the NHS with the biggest cash increase in its history, not only backs the high street and not only backs working people up and down this country, but backs Britain. This party backs Britain; the other side does not.

[Several hon. Members rose—]