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Value Added Tax Relief Act
#1
Madam Speaker,

It is my honor to present this bill for the consideration of this House:



Value Added Tax Relief Act
 
An Act to lower the rate of the Value Added Tax on Electricity and Fuel charges
 
BE IT ENACTED, by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—
 
 
A.     The rate of Value Added Tax as applied to electricity and fuel charges shall be reduced to 4% and shall remain at 4% through the year 1997.
B.     This Act shall extend to all parts of the United Kingdom.


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I have brought forward this bill on behalf of the Opposition, because we object to the Value Added Tax being extended to cover electricity and fuel charges.  While the Governing party promised not to extend the VAT in this way, it has done so.  The rate on electricity and fuel is currently set at 8%, and is scheduled to rise to 17.5% in 1995.  This represents an unjust burden on those least able to afford this added charge, in particular pensioners, most of whom do not pay a tax on income, but did so for decades before retirement.  It is immoral to burden them now.  Therefore, instead of more than doubling this already regressive tax, as the Government would have us do, the Opposition proposes an immediate halving of the Value Added Tax on electricity and fuel, with the possibility to abolishing it altogether in the future.
Max Power, Labour
MP for Oxford East (1987-present)
Shadow Foreign Secretary (1994-present)
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#2
Madam Speaker

Even though this legislation has been tabled by a member of Her Majesty's Opposition, I wholeheartedly support it. It is bad enough having to pay VAT on most goods, but to have it extended to essential services like heat and power is intolerable. This bill keeps the rate low so as to minimize the burden. The Shadow Chancellor has suggested an eventual aim of the complete repeal of VAT on utilities at some point in the future; I also offer him my support in achieving that goal.
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Mrs. Margo Leadbetter
Home Secretary and Secretary of State for DEFRA
Conservative MP for Surbiton
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#3
ORDER! The member shall resume his seat until this bill is read a second time.
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#4
Madam Speaker, I ask that this be read a second time

(I believe our Oppo day is Friday, and I'm just being proactive)
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#5
ORDER! Second Reading!
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#6
Madame Speaker,

Intention of this bill is great, I really like it but execution of it is, a bit troubled. While I would love to debate merits of the bill thoroughly, I feel like we must fix the legality part of it. I move to amend “ The rate of Value Added Tax as applied to electricity and fuel charges shall be reduced to 5% and shall remain at 5% through the year 1997.” 
Noémie Suchet MP

Member of Parliament for Bath

LibDem Leader
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#7
Madam Speaker,

I accept the amendment offered by the Right Honorable Leader of the Liberal Democrats.
Max Power, Labour
MP for Oxford East (1987-present)
Shadow Foreign Secretary (1994-present)
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#8
Madam Speaker
Now that this bill has been amended to accord with European law, I am pleased to offer my support. Power, heat and light are all essential services and it is wrong to apply too high a tax rate to them. The burden is particularly hard on vulnerable groups and also on families. In my view that is neither fair nor right. As such, keeping the tax rate low as a matter of law is a step in the right direction.
---
Mrs. Margo Leadbetter
Home Secretary and Secretary of State for DEFRA
Conservative MP for Surbiton
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#9
Madam Speaker,

I rise to express my gratitude to both the Right Honorable Leader of the Liberal Democrats, and the Honorable Member for Surbiton, for their support of this legislation. It is heartening to see that MPs in all three major parties want to give some tax relief to those who are most in need of it.
Max Power, Labour
MP for Oxford East (1987-present)
Shadow Foreign Secretary (1994-present)
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#10
Madam Speaker,

If we had this Labour Opposition in charge the country would now be facing a hefty fine from the European Court of Justice for breaching our obligations on VAT, if it wasn't for a last minute interjection from the Liberal Democrats. It is concerning that the man who wants to be chancellor is quite prepared to implement a policy when he had absolutely no idea it was illegal.

That being said, it is quite surprising to see the Labour Party decide to reduce VAT for fuel, considering they added it to the higher rate which was 25% in 1974. 

Madam Speaker, this Government is not prepared to change taxation policy on a whim from the Labour Party without due consideration. This would pile on more money to the national debt when we should in fact be taking measures to cut the national debt. I urge the Labour Party to also consider their plans for abolishing the reduced rate of VAT as it is a requirement as part of our obligations to the European Union as a member state. 

This Government is not prepared to lower the reduced rate of VAT without a full analysis of all the facts, including the legality of such a move. Therefore the Government will be voting down this bill.
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