As ever, my hon. Friend is absolutely right, and it is precisely to get that additional data that we have tabled this and similar amendments ever since the change was made. Why would the Government go through the process of looking at yield and getting HMRC to produce a report in 2011? That is important, because everyone knew—both at the time and ever since—that there were not enough data to come to an accurate view about yield as the rate had not been in place long enough. To put it bluntly, the Chancellor probably felt that some people might not agree with his decision to give people earning more than £150,000 a massive tax cut, given the state of the rest of the economy and the crushing of people’s living standards on his watch. What he needed to back his decision was a report that said that the 50p rate hardly raised anything at all, which is precisely what the HMRC report said. After analysing a host of facts and figures, the report concluded that a cut that would, by the Government’s initial estimates, cost £3 billion— the so-called static cost—excluding all behavioural changes would cost only £100 million.
The trouble with the report is that, as everyone acknowledges, there are too many uncertain variables to be anywhere near sure that the figure of £100 million is even close to reality. The report was based on only one year’s worth of data relating to 2010-11. That is a significant weakness, since we know that some incomes were taken earlier to avoid the extra tax. Further detail is now available, including for the tax years of 2011-12 and 2012-13 when the 50p rate was still in place. The writers of the 2011 report did not have those data available, so their report is therefore lacking. That could be remedied were the Government to accept our amendment.
The report attempts to quantify behavioural change. The scale of behavioural change is primarily based on an assessment of taxable income elasticity—basically the extent to which taxable income changes when the tax rate changes. The IFS says that there is a margin of error within calculations for the 2011 report, and that staying within that margin of error one could easily say, depending on taxable income elasticity, that cutting the rate of tax could cost the Exchequer £700 million or could raise £600 million. That gives an idea of the range of figures we are talking about and of how uncertain such projections are.
I return to my central point: more data are now available and could help to calculate a truer picture of the yield of a 50p tax rate as opposed to a rate of 45p. If Conservative Members are so certain that their position on the abolition of the 50p rate is true, why will they not agree to the scrutiny that the amendment suggests?