Tax Cuts: Fiscal Impact

Lord Sikka Excerpts

Wednesday 13th July 2022 Lords Chamber

[Baroness Penn (Con)]

My Lords, I think my friends in the other place are doing a good job of campaigning themselves. My understanding is that, although VAT receipts are higher, the fact that individuals are spending more of their money on things such as energy, which have a lower rate of VAT, means that the latest OBR forecasts saw overall government receipts from VAT reducing in the next year.

[Lord Sikka (Lab)]

My Lords, the contenders for the Conservative Party leadership, which include the Chancellor, have promised tax cuts adding up to £235 billion, without any consideration of their funding or the consequences of such cuts. Will the Minister publish a list of the courses the Chancellor has attended on economic literacy?

[Baroness Penn (Con)]

My Lords, as I said, the Government do not produce fiscal forecasts, the OBR does, and it produces forecasts based on government policy.