Finance (No. 4) Bill

Debate between Owen Smith and Baroness Burt of Solihull

Monday 16th April 2012 Commons Chamber

[Owen Smith]

All that we know is what is written on page 52 of the review by Her Majesty’s Revenue and Customs of the 50p rate, in table A2. It states in black and white that £3 billion a year will be forgone as a result of the changes, not the £100 million figure that is arrived at with smoke and mirrors about the taxable income elasticity calculation that Treasury Ministers signed off. What does the Office for Budget Responsibility say about that? As the hon. Gentleman said, it says that there is huge uncertainty about that calculation. We contend that we should rely on the absolute numbers, as revealed this morning—that £1 billion was raised from the 50p rate last year, not the nonsense £100 million figure.

That situation reveals the priorities of the Government, who are taking £3 billion from pensioners. On average, £83 is being taken from them, and £285 is being taken from those turning 65 this year, to pay for a tax cut of an average of £40,000 for 14,000 millionaires. That is the Government’s priority. We cannot pretend to understand it, but it is unfortunately the priority that working people will pay for.

[Lorely Burt]

The hon. Gentleman talks about the 50p tax rate, which his party’s Government introduced. I cannot remember how many days before the general election at which the coalition Government came into office that that happened—was it 48 days? May I invite him to speculate as to why the former Prime Minister had 13 years in government but brought in the 50p tax rate only such a short time before his Government left office?