Tax Fairness

Debate between David Gauke and Anas Sarwar

Tuesday 12th March 2013 Commons Chamber

[Mr Gauke]

There are two points. It is correct that the wealthy are often able to move income from one year to another, but the conclusion that HMRC and the Office for Budget Responsibility reached is that even taking into account the forestalling effect, the behavioural consequences of the 50p rate were so significant that it barely raised any revenue. That is the reality. It even takes into account the hon. Gentleman’s point about forestalling. That approach has been confirmed by the OBR. The 50p rate failed.

[Anas Sarwar (Glasgow Central) (Lab)]

The message that the Government have repeated over and over again is that we are all in this together. Take the example of families in my constituency who live just one mile apart. One has been handed a tax cut as a result of the scrapping of the 50p tax rate. One mile in the other direction families will be handed a food parcel. Does the Minister think that is fair?

[Mr Gauke]

Let us look at what was in the last Budget in respect of stamp duty and the cap on reliefs. We could also look at what we have done with regard to capital gains tax. The independent Institute for Fiscal Studies has made it clear that the top 20% are affected most by the fiscal consolidation policies that have been pursued in this Parliament. Those with broadest shoulders are bearing the greatest burden. However, we have an enormous deficit that we have to get down—a deficit that we inherited from the Opposition.

Oral Answers to Questions

Debate between David Gauke and Anas Sarwar

Tuesday 6th March 2012 Commons Chamber

[Mr Gauke]

There are times when taxpayers engage in aggressive avoidance and we put a stop to it, as we did last week. However, the offsetting of losses is not novel—it is a long-standing element of the tax system—and, although of course we keep all such matters under review, the legitimate use of losses does not necessarily count as aggressive avoidance.

[Anas Sarwar (Glasgow Central) (Lab)]

Given the Government’s attempts to cut the deficit, it would make sense to clamp down on tax evasion, so why are they cutting 10,000 staff at HMRC?

[Mr Gauke]

We are cutting down on tax evasion. Whereas under the previous Government tax evasion coverage was reduced—the number of staff dealing with tax evasion was reduced—it can be seen that the number of people working on tax evasion in HMRC is now increasing.

Living Standards

Debate between David Gauke and Anas Sarwar

Monday 5th March 2012 Commons Chamber

[Mr Gauke]

I am going to make a little progress.

We know, given the constraints that we face in the public finances, alongside high commodity prices and international uncertainty, that these are tough times for many families. That is why we have taken substantial steps to protect living standards, and to ensure that we support our poorest and most vulnerable families. Even as we cut the deficit, fairness has been at the very core of our spending plans. We will not let our poorest and most vulnerable families bear the consequences of the previous Government’s failures. That is why we have secured the largest ever cash rise in the basic state pension, and why we have uprated working-age benefits by 5.2% to protect the real incomes of the poorest.

[Anas Sarwar (Glasgow Central) (Lab)]

rose—

--- Later in debate ---

[Mr Gauke]

We believe there are a lot of votes in the hon. Lady’s constituency.

I was going through the things we have done to help the poor, but let me continue. What we have done with the personal allowance is a big step—helping working people, ensuring that work pays and lifting living standards for those on low incomes. That is why this Government have made increasing the personal allowance one of our key priorities in supporting low and middle-income families across the UK. In April 2012, we will make a £630 increase in the personal allowance, taking it £8,105, which, taken with the £1,000 increase in April 2011, will benefit 25 million taxpayers, taking 1.1 million low-income individuals out of income tax altogether. We note that the shadow Chief Secretary to the Treasury expressed her opposition to that policy just a few minutes ago.

[Anas Sarwar]

Will the Minister explain how living standards are increasing for families in Glasgow when 2,000 couples and 4,000 children will lose up to £4,000 in working tax credits at the same time as VAT is going up, inflation is high and the cost of living is going up? How is that improving living standards for poor families in Glasgow?

[Mr Gauke]

I come back to the initial point: we face a huge deficit. People recognise we have to reduce it, but at the same time we are trying to do everything we can to protect the poorest. That is why we are running through the issues here.

Oral Answers to Questions

Debate between David Gauke and Anas Sarwar

Tuesday 22nd March 2011 Commons Chamber

[Mr Gauke]

My hon. Friend is absolutely right and it is striking that the previous shadow Chancellor and the previous shadow Health Secretary said that it was madness to ring-fence the NHS. That is not the view of this Government.

[Anas Sarwar (Glasgow Central) (Lab)]

13. What assessment he has made of the effect on road fuel prices of the increase in the standard rate of value added tax.

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

How much of the rise in the standard rate of VAT is passed on to consumers is a commercial decision for retailers.

[Anas Sarwar]

I thank the Minister for that answer. Treasury Ministers are very wrong to suggest that the calls to scrap the VAT increase on fuel is illegal and unworkable. There is precedent for it: the French President recently got a derogation from EU laws for French restaurants. Will this Government stand up for UK families who have been hard hit by the rise in fuel costs and look for derogation powers on fuel duty?

[Mr Gauke]

A week ago, the shadow Chancellor was saying that we needed an immediate cut in the tax on fuel and now the Labour party is saying that we should start a process that will take about seven years. That does not strike me as being terribly helpful.