Oral Answers to Questions

Kevin Hollinrake Excerpts

Tuesday 24th October 2017 Commons Chamber

[James Cartlidge (South Suffolk) (Con)]

10. What recent progress has been made on reducing the deficit.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

15. What recent progress has been made on reducing the deficit.

[The Chancellor of the Exchequer (Mr Philip Hammond)]

The Government have reduced the deficit by well over two thirds—from a post-war high of 9.9% of GDP in 2009-10 to a low of 2.3% of GDP in 2016-17. We have done that not out of some ideological obsession, but because the key challenge is to get debt falling to increase the resilience of our country so that if the need were ever to arise, we would have the capacity to support the economy against a future shock.

--- Later in debate ---

[Mr Hammond]

Yes. It is not responsible to make so-called hard choices by loading the price on to the next generation and the generation after that. We have to make difficult decisions and we have to bear the consequences of those decisions. At £65,000 per household, our public debt is still far too high, so I can confirm to my hon. Friend that we will continue the plans that we have announced to reduce the deficit in a measured and balanced way to ensure that debt falls as a share of GDP.

[Kevin Hollinrake]

Despite this Government’s significant efforts to tackle the deficit by reducing tax avoidance, companies such as Microsoft and Apple are still saving hundreds of millions of pounds in corporation tax by booking sales in Ireland. Does my right hon. Friend agree that we need to continue to develop measures to make sure that companies that sell to UK customers pay tax in the UK?

[Mr Hammond]

My hon. Friend puts his finger on an important problem. Corporation tax in the UK—in fact, in all countries—is levied on profits generated by the activities of companies within the territory. The big global digital companies present us with a new challenge of attributing profits effectively to individual jurisdictions. We are continuing to work with the OECD’s taskforce on the digital economy, and we are also looking carefully at ideas emerging within the EU for interim solutions pending a full international solution.