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Finance (No. 4) Bill

No. I am going to make more progress. Returning to the age-related allowance, it will remain the case that those receiving employment income above the retirement age will not pay national insurance contributions. We have heard nothing this evening about why the Opposition believe as a matter of principle that those under the age of 65 should have a lower personal allowance than those over the age of 65. Given that the personal allowance has increased so substantially, it is reasonable and sensible to simplify the tax system and have one generous personal allowance, regardless of age. We have taken decisions to remove anomalies in the VAT system, but VAT is a broad-based tax and it is neither fair nor economically justifiable for similar or identical products to be treated in different ways on the basis of arbitrary distinctions. The same approach should apply to mobile caravans as to static, non-residential caravans, and to a hot pie served in a fish and shop and one served in a bakery. Labour Members argue that removing those anomalies will hit living standards, but may I put those measures in context? Next year, basic rate taxpayers will get a £170 income tax cut. That will be sufficient to pay VAT on 1,300 Greggs hot sausage rolls. I confess that those consuming more than 1,300 Greggs hot sausage rolls—that is 26 a week—will lose under the Budget, but I suspect that that is the least of their worries. We are taking a tough decision on child benefit, but it is right that those earning £20,000 or £30,000 should not pay taxes to fund child benefit for the families of those who earn substantially more. Each of those policies has produced opposition, and whenever there is opposition to a difficult decision, along comes the Labour party. It opposes each and every measure, however logical or fair it may be. Labour agrees with every interest group that comes along and says, ““Don't tax us,”” or ““Keep spending on this.”” The Labour party is the party that likes to say yes, just as it did in government. Is it any wonder that it left the public finances in such a mess? There is one tax increase that Labour has supported: the increase in the additional rate of income tax to 50p, which the hon. Member for Pontypridd (Owen Smith) spent so much time on. What is the effect of the 50p rate? We have the assessment of HMRC. What has the 50p rate achieved? More people work overseas; total income has fallen by between £2.9 billion and £4.4 billion; and GDP is between 0.2% and 0.3% lower. All of that is from the HMRC assessment.