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Finance Bill

The hon. Gentleman is right to say that that very technical issue would not require a derogation, because in order to levy VAT on bingo as we do, the Government apply a derogation to the existing European Union legislation. This issue is subject to a court case, known as the Linneweber judgment. I shall not go into that this evening, because it is extremely complicated and I would not want to bore hon. Members rigid by referring to it. In order to remove VAT on bingo duty, we would need an exemption from the exemption that we already have. The issue is complex, but it would not be difficult to remove VAT on bingo. As I have mentioned, the wider aspect is that the Government will lose revenue from the closure of bingo clubs, and our constituents will be deprived of a particular leisure activity. I mentioned that nine clubs have already closed this year at a potential cost to the Treasury of £5.6 million, which adds to the £25.9 million potential cost of the 37 clubs that closed last year—that already represents more than the tens of millions estimated by the Treasury. I hope that the Government will re-examine bingo duty as the Finance Bill goes through Committee. As I say, we have lobbied hard on this matter, from the Prime Minister downwards, to try to get some relief. My remaining comments will be about the 10p tax rate, which has been widely covered by hon. Members. I do not have much to add, except to say that I cannot understand why this Government, who have known about this for a year and have done the calculations, have abolished this 10p tax rate without realising the consequences. Like many hon. Members, I have been out campaigning in the local government elections and have been surprised by the representations that I have received on the doorstep, and by the number of letters and emails I have received about this matter. That is mainly because, like other hon. Members who made representations to the Treasury on behalf of constituents, I was assured that this would affect a small number of people at a very small level of income. As it is, that level of income is obviously very important to the people affected, because they are on low incomes, and I cannot understand why a Labour Government have simply not thought this through. I heard the Prime Minister saying on the radio today that nobody will lose out because of the proposal. My hon. Friend the Member for Middlesbrough (Sir Stuart Bell) also suggested that nobody would lose out, and that the 5.3 million people could be wrong. People do not agree with that view. They do not see the wider picture, and that perhaps their allowance has gone up in some way and perhaps the winter fuel payment will compensate them in another way. They see an increase on their tax assessments and a reduction in the money coming into their households each week. They perceive that they are being taxed by this Government even though they are the lowest paid in our society. The Government must overcome that perception. Saying that we will have a review starting for the pre-Budget report in November simply will not wash with anybody. It will not wash with me, because I do not agree with that approach. I want the Government to re-examine this matter and come up with something substantial rather more quickly than that to alleviate my constituents' concerns. The only sensible option produced so far in this debate was put forward by my right hon. Friend the Member for West Dunbartonshire (John McFall), the Chair of the Treasury Committee, who said that his Committee will re-examine the issue. The Government must re-examine it otherwise they will be labelled as the Government who are taxing the lowest paid in our society while at the same time making concessions on inheritance tax and capital gains tax for venture capitalists. I urge my hon. Friends to look again at this issue.