Fairness and Inequality Debate

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Department: HM Treasury

Fairness and Inequality

Brian H. Donohoe Excerpts
Tuesday 11th February 2014

(10 years, 8 months ago)

Commons Chamber
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Guto Bebb Portrait Guto Bebb
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It undoubtedly did not help.

When we discuss inequality we should be aware of the key point that the Government have been very proactive in ensuring that the inequality faced by pensioners is dealt with. We can compare the impact of the triple lock on pensioner poverty with the previous Labour Government’s decision to increase pensions by a paltry 75p.

Brian H. Donohoe Portrait Mr Brian H. Donohoe (Central Ayrshire) (Lab)
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Taxation is not just about income tax, but about VAT. Is that not perhaps the most unfair tax on those at the bottom of the pile?

Guto Bebb Portrait Guto Bebb
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I would reject that argument. We talk about VAT, we often forget the exemptions. If somebody is buying a new Ferrari, I have no problem with their paying £50,000 in VAT. If somebody buys their food in a supermarket, they pay 0% in VAT. If VAT were 20% on every single item, it would be a regressive tax. For those who spend a significant proportion of their income on food, or on household fuel, which is taxed at 5% rather than 20%, the VAT issue is not as clear cut as Opposition Members try to make it.