Written question asked by Vincent Cable (Liberal Democrat) on Monday, 2 February 1998, in the House of Commons. It was due for an answer on Tuesday, 10 February 1998. It was answered by Baroness Primarolo (Labour) on Tuesday, 10 February 1998 on behalf of the Treasury.

Treasury

Question: To ask Mr Chancellor of the Exchequer, what (a) short run and (b) long run price elasticity of demand is assumed by the Treasury in its analysis of the impact of tax changes in respect of (i) cigarettes, (ii) beer, (iii) wine, (iv) spirits, (v) petrol, (vi) domestic gas, (vii) domestic electricity and (viii) domestic energy as a whole. - Inc figs.

Answer: Dr. Cable: To ask the Chancellor of the Exchequer what (a) short run and (b) long run price elasticity of demand is assumed by the Treasury in its analysis of the impact of tax changes in respect of (i) cigarettes, (ii) beer, (iii) wine, (iv) spirits, (v) petrol, (vi) domestic gas, (vii) domestic electricity and (viii) domestic energy as a whole. [27476] Dawn Primarolo: The costings for tax changes for the current year and the following two years are published in the Financial Statement and Budget Report. In preparing these costings, Customs and Excise use the following elasticities: cigarettes -0.201, beer -0.963, wine -1.048, spirits -1.070 and petrol -0.272. Domestic gas, domestic electricity and domestic energy as a whole are grouped under domestic fuel and power. All use an elasticity of -0.187.

Secondary information

Type: Written question
Reference: 306 c135W; 27476
Session: 1997-98
Subjects: Alcoholic drinks Beer Energy Excise duties Petrol Prices Taxation Tobacco Tax rates and bands Wines Spirits
Contains statistics: Yes