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Mortgage Interest Payments

Part of Orders of the Day — Finance Bill – in the House of Commons at 7:45 pm on 15th July 1997.

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Photo of Mr Patrick Nicholls Mr Patrick Nicholls Conservative, Teignbridge 7:45 pm, 15th July 1997

It has been my experience that one can never make that assumption with complete confidence.

The hon. Gentleman might say that everyone knew that taxes would go up, but that view was not universally shared. It was not shared by the Prime Minister. In an article in the Financial Times on 21 September 1996 he said: I have to say"— that is how he puts it— that we have no plans to increase tax at all. He actually used the phrase "at all" to reassure people.

It was not just the Prime Minister who said that. As recently as 8 April 1997, at the beginning of the election campaign, the Chancellor said: There is no black hole for the Labour party because we have got no public spending commitments that require extra taxes. One man's black hole leads to someone else's black death, because it is pretty obvious now that there has been a huge amount of extra taxes. It is clear that some people knew that taxes would go up, and those people were the Opposition if they came into government.

It is worth placing MIRAS in the context of 17 tax rises from people who were saying days before the general election that there would be no increase in taxation. I will not go through all of them, but there are some that might be thought to be directly relevant.

MIRAS itself means that taxpayers will pay an extra £950 million. Stamp duty will cost them £540 million; the abolition of tax credits for pensions, £5.4 billion; the windfall tax, £5.2 billion; the limitation on the carrying back of trading losses, £250 million; the abolition of relief for medical insurance, £135 million; corporation tax, block leakage £190 million, finance leasing £300 million, more finance leasing for sale and lease-back £40 million, company purchase schemes £100 million; trade debt schemes £10 million; VAT cash accounting £15 million.