Finance Bill

The clause to which the amendments apply imposes income tax for 2007-08—each year’s Finance Bill has to plan for subsequent years—but keeps income tax rates unchanged for the current year at 10 per cent., 22 per cent. and 40 per cent. The combined effect of the amendments would be to replace the current starting rate band by a zero rate band and to cut the basic rate for this year from 22p to 20p. The hon. Member for Chipping Barnet (Mrs. Villiers) and my hon. Friend the Member for Wolverhampton, South-West (Rob Marris) said that that was not costed. I can tell the House that the total cost of implementing these two amendments this year would be £13.8 billion, which I would have thought is quite a tidy sum even for the Liberal Democrats. Therefore, I agree with the hon. Lady that the Liberal Democrats tax proposals are flawed. The hon. Member for Falmouth and Camborne (Julia Goldsworthy), who speaks for the Liberal Democrats on these matters, is wholly at liberty to table amendments to the Finance Bill setting out in detail how £8.1 billion in environmental taxes would be made up, along with other details of the package outlined in her party’s policy document. The great majority of Members would warmly welcome that information.