Value Added Tax Bill

Debate between James Cartlidge and Maggie Throup

Friday 8th February 2019 Commons Chamber

[James Cartlidge]

The hon. Gentleman is correct: I do not spend a lot of time at Labour party conferences. I am sure that, because he is there, it is huge fun. I know that he has a great sense of humour and so on. I never met Barbara Castle, but I am sure that it would have been a great honour to meet her. I do agree with that basic set of housekeeping accounts, which, by the way, the great Margaret Thatcher also used to believe in.

[Maggie Throup]

As my hon. Friend mentioned Barbara Castle, I want to put it on the record that she had the same education as I did. We went to the same school—Bradford Girls’ Grammar School. On both sides of the House, we can make sure that we chalk up our balances on the chalkboard—or the whiteboard as it would be now.

[James Cartlidge]

That is an excellent point. What worries me is that if we make unfunded commitments that do not result in the so-called dynamic behaviour that has been predicted and the Treasury loses revenue, the people who pay will not be us in this Chamber or anyone outside, but people who have not yet been born. We will stick the balance on the national credit card and, ultimately, the national debt. That is what happens if we do not take control of public finances.

I also want to talk about the transition period and leaving without a deal. My hon. Friend the Member for Christchurch seemed to suggest that we would benefit from not having a transition, because we would be able to vary VAT. He will remember that in his speech in the recent no-confidence debate—he spoke eloquently, although it took me some time to work out whether he had confidence in the Government or not—he advocated a WTO-terms exit. I intervened on him to ask what he would do about the 40% tariff on sheep meat, and he said to me that that was “Project Fear”.

In fact, if we leave without a deal, we will have to have the default WTO schedule, because there is nothing else. That schedule includes some very onerous tariffs indeed, not least for our farmers and exporters. In a debate about the cost to consumers of VAT, it is quite something to advocate allowing certain household items that we take for granted—such as dry pasta and tinned tomatoes—to be tariffed at 15% or 20% in a few weeks’ time. This is most significant for our exporters. In my constituency, I have household name companies—by that, I mean that they are very well known in the constituency—that have written to me about no deal. The matter is critical for them; in one case, the default tariff exceeds the margin that the company makes. That is serious stuff, which we need to be prepared for.