Finance Bill

It has been an interesting debate and many of the points that I wanted to make have already been addressed. The hon. Member for Elmet and Rothwell (Alec Shelbrooke) made much of the fact that we should judge the VAT rise as part of a package. It is a package that puts money into the pockets of the rich, so it does not surprise me that a Conservative Member should welcome it. He said that income tax was regressive whereas VAT was not. He ought to have consulted the words of his leader, now Prime Minister, who, on 8 May, said of VAT:""it's very regressive, it hits the poorest the hardest ...VAT is a more regressive tax than income tax or council tax."" I rather think that the hon. Gentleman will be waiting some time for a telephone call when the reshuffle eventually comes, given the way he contradicts his Prime Minister. It is unfortunate that the spokesman for the Liberal Democrat party is not here. This is an interesting innovation. We have spokespersons for the Government—Ministers and so on—and spokespersons for the Liberal Democrat party, who made a case for the Government's decision to increase VAT. I wonder which Liberal Democrat party they were speaking for—certainly not the party in the country. A poll the other day—I do not know whether other hon. Members saw it—showed that the overwhelming majority of Liberal Democrat party members did not support the increase in VAT. It is interesting to note that the hon. Member for Bermondsey and Old Southwark (Simon Hughes), the deputy leader of the Liberal Democrats, is not in his place. That may be to do with the fact that he has a different view, probably the view of the Liberal Democrat party rather than that of the Government. He said in June:""I hope we don't have a VAT increase because it is the most regressive form of tax, it penalises the poor at the same rate as the rich."" The Deputy Prime Minister said in April, just before the election, that VAT "is a regressive tax". The Leader of the Welsh Liberal Democrats, the hon. Member for Brecon and Radnorshire (Roger Williams), will not support any increase in VAT because it is a "very regressive tax". The two parties went into the election saying that there were no plans to increase VAT. The Chancellor, then the shadow Chancellor, said in April this year—not so long ago—that the Conservative tax plans were""already in place, the plans do not include an increase in VAT.""