Finance Bill

I welcome this debate, and all hon. Members will understand the motivation and thinking behind the new clause moved with characteristic conviction by my right hon. Friend the Member for Birkenhead (Mr. Field). However, I hope that I can persuade the House that the proposal is impractical and that, if we are to assess the impact of personal tax changes on a group of taxpayers, we need to do so over a period longer than that covered by a single Budget. It is worth reflecting on what this year’s Budget package will achieve. There will be a significant simplification of the income tax system, which my right hon. Friend has welcomed, and the reduction in the basic rate to 20p. A further 200,000 children will be taken out of poverty, on top of the 600,000 helped in that way by previous measures. More than 500,000 pensioners will be taken out of tax entirely, and the biggest proportionate gains from the Budget tax package will go to those in the lowest two deciles of income. That latter fact is something that I want to emphasise, especially in light of the observations made by my hon. Friend the Member for Wolverhampton, South-West (Rob Marris), and it is made clear in the analysis presented by the Institute for Fiscal Studies to which a number of speakers have referred. That analysis is still available on the IFS website, and I was checking it out earlier today. It is a very striking attribute of the Budget that the biggest proportionate gains go to the households on the lowest incomes.