My Lords, I will focus my brief remarks on two aspects of the Bill: one is an amendment to it and the other is an omission from it. Both would improve this legislation—they are intended to be constructive and helpful—and both are important to many millions of people, working or otherwise. First, I want to raise the issue of inheritance tax, which the Minister highlighted in his comments. Secondly, I want to raise the so-called tampon tax.
Politics is about choices, and showing who we care about and how we connect with them are central to any party’s political strategy. The choices reveal much about the values that inform our politics and our policies, and the Tory Government have recently laid bare their current values. At this time, at this defining moment, when all the analysis and forecasts of the UK economy are best described as fragile—rather than the rather robust description given by the Minister—and the public realm is about to be subjected to 40% austerity cuts, the Government have decided that the time is right, never better, to increase the inheritance tax threshold to £1 million, so that those with the most, the wealthiest 10%, get a fighting chance at keeping the wolf away from their doors. The cost to the Exchequer is close to £1 billion.
Compounding this particular choice at this time is the fact that it is being put forward while the Chancellor is seeking to cut £1,300 on average from the income of the lowest paid 3 million working people in the country. It is a somewhat hideous juxtaposition that the Government are putting forward. The richest 10% get a £1 billion give-away; the poorest working people lose £1,300 on average a year. It is compassionate conservativism laid bare. The rhetoric may be compassionate, but the reality is conservatism.
Instead of the somewhat false fury that emanates from Downing Street about some sort of constitutional crisis in this House because of the decisions your Lordships’ House took on the issue of tax credits, they should be thanking your Lordships for getting them out of a deep hole. It was getting deeper and deeper by the minute as Conservative Member after Conservative Member was in rebellious mood about the matter. We will seek a delay on this issue, deletion of this clause, and a delay at least until the Chancellor has achieved a current budget surplus before any further consideration of changes to the inheritance tax threshold.
On the tampon tax, until the recent exchanges in the other place, I have to admit that I was unaware that VAT was payable on tampons and sanitary towels. If I had to guess the odd one out or play spot the luxury item from among the following list—Jaffa Cakes, a game of bingo, a ticket to the zoo, or tampons—I do not think I would have picked tampons as being the specific luxury item. However, apparently that is the case. Jaffa Cakes are a necessity; tampons a luxury. As we have heard, the Prime Minister this morning set out his priorities for achieving reforms in the EU in advance of the forthcoming referendum. I had hoped that, when the letter to President Tusk was written, it would have contained a line seeking support across Europe to allow tampons and sanitary towels to be zero-rated in each member state. Had he done so, his legacy would be assured. We have had some words of support from government representatives, but nothing concrete is proposed. Incidentally, the cost of this change to this country would be no more than £15 million to the Exchequer. Labour will seek to add a clause to the Finance Bill to give effect to this.
I look forward to hearing the Minister’s response to these two items in his closing summary.