Finance (No. 4) Bill

Debate between Mark Reckless and Owen Smith

Wednesday 18th April 2012 Commons Chamber

[Owen Smith]

We should give the hon. Gentleman time to warm up, but if he wants to intervene to tell me where in the HMRC report we can find a definitive set of data on the impact on competitiveness of the various rates of tax, I will gladly sit down and wait for him to do so.

[Mark Reckless (Rochester and Strood) (Con)]

rose—

[Owen Smith]

Does the hon. Gentleman want to intervene on me on the point of competitiveness using evidence or anecdote?

[Mark Reckless]

The document says that all this is highly uncertain. That means that there is a significant possibility that the 50p rate was losing the Government revenue. Would the hon. Gentleman therefore welcome support for his amendment from the Government Benches at 4 o’clock?

[Owen Smith]

I am very pleased that I gave way to the hon. Gentleman. His intervention has exposed the fact that Conservative Members do not read the documentation, even though they listen to the flannel from their Front Bench. I repeat that page 39 of the document shows, under the heading “Adjusted impact on 2010-11 tax liabilities”, that the post-behavioural yield is £1.1 billion. It is there in black and white. That is how much money the 50p rate raised. No one is disputing that, and I presume that the Exchequer Secretary is not going to get to his feet and dispute what is written on page 39, or indeed, what is written on page 2, in the summary. I do not think that he is going to do that.

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[Owen Smith]

I grateful for that intervention. I am not sure whether the pork pie was served at ambient temperature, but it was certainly a pork pie.

[Mark Reckless]

rose—

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[Owen Smith]

I hate to say it, but it is worse than that. What happened is that the Chancellor made up his mind, and then made the evidence fit his decision. [Interruption.] I am asked where is the evidence, but 32 times in the one exculpatory piece of evidence provided, the Treasury covered its behind by referring to uncertainty. I shall go through them in a minute, but that shows how often it was necessary to justify this damascene conversion.

[Mark Reckless]

Does the hon. Gentleman not accept that because the situation is uncertain, the 50p rate might have cost revenue, so the Government had less money for the least fortunate in society?

[Owen Smith]

I do not know how many times I need to keep telling the hon. Gentleman this, but the simple answer is no. He should turn to page 2 of the document, which clearly says that this rate raised £1 billion; he should turn to page 39, which says that it raised £1.1 billion; he should turn to page 51, which says that it will rise to £3.1 billion next year. These would be the static costs. It goes on to say—[Interruption.] No, £1.1 billion is the actual amount lost to the national accounts as a result of this change. That is a fact. It is not uncertain; it is a fact. The Treasury thinks that the money would have gone up to £3 billion, rising to £4 billion subsequently.