Will we ever be able to abolish VAT charges we do not like? What’s happened to the promised deal?

The UK Parliament cannot abolish the tampon tax. The UK government  lost a court case in the ECJ over keeping our VAT rate on green products at 5%. We have been ordered to raise the rate to 20%, making it much dearer to insulate our homes or fit heat pumps. We cannot take VAT off domestic fuel though that would ease pressures on family budgets and cut fuel poverty.

The Remain side say the negotiations included a provision to let the UK and other states have more flexibility over VAT lower rates. On April 7th the EU issued what it wants to do on VAT, to the total silence of the UK media even though this was an important statement rather like a Budget, affecting a major tax which the EU controls.

The main thrust of the Commission’s Action Plan for VAT is more centralisation. They want more control over cross border VAT, more control over tax fraud cases, and a new clarity in how and where VAT is levied. They will doubtless achieve their centralising ends, and they propose legislation this year to do so.

They offer two models for possible legislation in 2017 to give more flexibility to member states. They say they could examine the current list of exemptions and permissions for lower rates to see if others should be added. No additions are proposed in the document to cover the UK requirements, and any such changes would require the consent of the other member states. Or they say they could allow member states to choose their own lower rates, but this would have to be subject to new controls to stop tax competition and damage to the single market.  In other words member states would not be free to choose their lower rate items as they wished.

 

More interestingly the Commission says either of these changes would require clear political directions from the member states as a whole and from the European Parliament. There is no statement that this has to be delivered to meet the terms of the UK renegotiation, no sense of urgency, no sign of any Special Status on tax for the UK.

 

It looks as if the delegation of more authority to states to choose lower rate VAT is far from a done deal and not an EU priority. The Commission document has helpfully reminded us of who is in charge on VAT, and set out a course for a more centralised VAT system.

The EU has also been doing work on a fiscal union with more control over member states taxes generally.

The conclusion to all this is that the UK is still not allowed to repeal the tampon tax and has to put up its VAT on green products to comply with the ECJ ruling. There is no reliable relief in sight. So where are the results of the UK’s renegotiation? Why doesn’t the EU simply have to change the law to allow us to alter our VAT rates?

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107 Comments

  1. Lifelogic
    Posted April 18, 2016 at 5:38 am | Permalink

    Indeed we cannot even do something as minor as abolish VAT on sanitary products and insulation.. It is vital we cut free and restore some real democracy again. More absurd scare stories from our incompetent and dishonest treasury again today I see. They clearly think the public are very daft. Why would cheaper energy, far fewer regulations, less government, lower taxes, simpler employment laws, free trade with all the World, and quality selective only migration make us worse off? By what mechanism?

    Rather a shortage of school places it seems thanks to the open door to low paid immigration I see. What did they expect?

    • Lifelogic
      Posted April 18, 2016 at 12:09 pm | Permalink

      Osborne seems to think we will be £4,300 poorer after Brexit.

      http://www.bbc.co.uk/news/uk-politics-eu-referendum-36070761

      He also said it was “economically illiterate” to say the UK could retain “all the benefits” of EU membership and “none of the obligations or costs”. Well Osborne should certainly know about “economic illiteracy” with his job destroying nation living wage, his landlord muggings, his sugar tax, his pension grabs, his HS2, his record trade deficit, his huge PSBR and hugely increased borrowing and his open door, low paid net cost, migration.

      Permanently poor if we left he says. Just getting rid of the misguided (lets shoot the economy in the foot) George Osborne would be a huge economic bonus.

      • Lifelogic
        Posted April 18, 2016 at 12:10 pm | Permalink

        Permanently Poorer if we left – I meant.

  2. eeyore
    Posted April 18, 2016 at 5:56 am | Permalink

    Time out of mind – which the law defines as before July 6 1189 – the English have possessed two great freedoms: they make their own laws and vote their own taxes. The last time these mighty rights were challenged by government there was a civil war.

    A nation that does not defend its liberties will lose them.

  3. bigneil
    Posted April 18, 2016 at 5:59 am | Permalink

    Again another reason for getting out of this dictatorship – but can I bring up the point
    of CMD staying in power to “oversee” our exit from the EU if the vote is the right one? Why on earth should he be left to do exactly what he doesn’t want to do. On a “leave” vote he would do everything to destroy this country, because he has become power mad. He knows if he can help destroy this country and nation he will be working in EU HQ, furthering the destruction of nations. God knows what CMD, Merkel and the rest of the power crazed loons would set up in secret – – CMD would probably be signing things away as fast as he could, while still in the PM seat. A very nasty, dangerous and vindictive person in my opinion.

  4. @Jerontius
    Posted April 18, 2016 at 6:01 am | Permalink

    The tampon tax is a life-shattering burden. I would rather be reinvaded by Holland than be subjected to it.

    • agricola
      Posted April 18, 2016 at 6:48 am | Permalink

      It will help you cut down on smoking them.

    • Bob
      Posted April 18, 2016 at 6:59 am | Permalink

      @Jerontius You’ve obviously missed the point, it’s about whether our elected MPs can decide if tampons are a luxury or a necessity or when they need permission from an unelected nomenklatura.

      • Bob
        Posted April 18, 2016 at 7:00 am | Permalink

        * whether

    • Hope
      Posted April 18, 2016 at 7:10 am | Permalink

      I am not sure whether to laugh or cry at the stupidity of Cameron and Osborne. Today we read Osborne dire warning that public service spending will need to be cut if we leave the EU. First, this is what he promised to get elected in 2010 and has still failed to deliver and is till running a huge deficit. Second, the U.K. Public services are overwhelmed because of mass immigration denying our own citizens who paid into the pot the places they deserve. Third overseas aid is predicted to or take local authority spending next year. Four , Osborne sends the UK budget to the EU for approval now what would it be like if we are stupid enough to remain! Five, Osborne thought more about flying on the US president’s plane than sorting out the UK budget in 2012 while the civil service played a ruse on him to introduce the pasty tax. This years budget another farce that has turned into chaos. Six, he could of course help public spending by cutting overseas aid or contributions to the EU to spend on public services. 500000 Eau citizens entering our country each year has an impact on our public services, cut the number and get control of our borders will help public spending. I think Osborne is an idiot. Perhaps he could reflect on “Black Wednesday” when jobs business and homes were lost trying to enter the ERM. Ask Cameron he was advising Lamont, Major was in charge at the time and it was a catastrophe to millions of UK citizens.
      Merkel now agreeing to the prosecution of a comedian to please Turkey. How will the European Arrest Warrant play out here? If Turkey joins the EU would comedians be whisked off to a Turkish jail for having a laugh? Could Cameron explain how this makes us safer! JR, you and your colleagues need to sack Cameron, Osborne will follow.

    • forthurst
      Posted April 18, 2016 at 10:10 am | Permalink

      “The tampon tax is a life-shattering burden.”

      So why does the Brussels regime wish to control it? Because a) they are a bunch of loathsome control freaks and b) they have been creating a unitary state by stealth for forty years in which no aspect of our lives will be overlooked for regulation.

      That they have got away with it for so long is a testament to the treachery of politicians who would rather take brickbats than admit they are simply doing mandatory Brussels’ bidding, and the serious infestation of traitors to this country that infests and controls the media, particularly the BBC, whose poll tax should be abolished.

  5. Ex-expat Colin
    Posted April 18, 2016 at 6:02 am | Permalink

    Appears that much of the audience at QT last week didn’t understand that the EU cannot be challenged on VAT. So anything Dan Hannan provided really counted for little because they saw him as rather a Tory rich person.

    The SNP (Robertson) acted as a crowd jerker mainly… only didn’t get to answer a request for info about how to manage Scotland without enough money. Seem to think the EU will save us all…from the Tories?

    Wondering how the Frenchman (Fin Minister) is going to reform the EU? Reform what they like as long as we are out!

  6. Lifelogic
    Posted April 18, 2016 at 6:14 am | Permalink

    Further potty scare stories from Osborne about the NHS and Schools post Brexit.

    In fact the NHS and Schools will be far better placed with selective immigration (of only the people we need and people who will pay sufficient taxes to provide for their NHS, Education, and public service needs). Not that anyone can take Osborne remotely seriously. Anyone who thinks that the National Minimum Wage is good for the UK economy or jobs clearly does not even have a the most basic grasp of economics. The higher minimum wages will also draw even more lower paid migrants. Post the Brexit vote please can we have a chancellor with at least a basic grasp of economics?

    http://www.telegraph.co.uk/news/2016/04/17/nhs-and-schools-will-face-billions-in-cuts-if-britain-votes-to-l/?WT.mc_id=e_DM110620&WT.tsrc=email&etype=Edi_FAM_New_AEM_Recipient&utm_source=email&utm_medium=Edi_FAM_New_AEM_Recipient_2016_04_18&utm_campaign=DM110620

  7. Mark B
    Posted April 18, 2016 at 6:17 am | Permalink

    Good morning.

    So a major EU initiative to control our taxation via VAT goes unreported by our media. This backs up my claim that we are deliberately being kept in the dark as to what is happening to us and the direction and ultimate destination, a United States of Europe.

    The OUT campaign must shame the media, especially the BBC, and ask why they are not reporting this and, suggest that they, by not reporting such matters, are colluding with both the INNERS and the EU.

    Private media my have a position, but the BBC has a mandate, to inform, educate and entertain. Whilst there is little entertainment from the EU, unless you like watching headless chickens run around, on the matter of educate and being informed I think this comes very much under their remit.

    Shame on you BBC, you are NOT fit for any purpose let alone the one you suppose to do !

    • Know-dice
      Posted April 18, 2016 at 6:49 am | Permalink

      As you say “the BBC has a mandate, to inform, educate and entertain.”

      Not much “educate here” – http://www.bbc.co.uk/news/uk-politics-eu-referendum-36054645

      “Over the last 15 years, Cornwall has received more than £1bn of EU structural investment. Don’t worry if that fact has passed you by. Plenty of the people I met in Cornwall appear to be unaware of it too. ”

      No mention that “EU structural investment” to Cornwall is money that comes from the UK in the first place…

    • agricola
      Posted April 18, 2016 at 6:50 am | Permalink

      The EU pay the BBC, look no further.

    • Lifelogic
      Posted April 18, 2016 at 7:03 am | Permalink

      The BBC is clearly a propaganda organisation from top to bottom. There presenters (include many who are)Guardian think, second rate art graduates, lefties and Libdems.

      There agenda is always for: ever more EU, ever more taxation, ever more government, ever more employment and other regulations, ever more “diversity”, ever more enforced “equality”, every more green crap and climate catastrophe alarmism, ever more trains/cyclists and road blocking and a criminal justice system totally devoid of any real deterrents (save for wealthy tax evaders perhaps).

      • Hamsterwheel
        Posted April 19, 2016 at 1:13 pm | Permalink

        “(save for wealthy tax evaders perhaps).”

        You forgot those motorists travelling at +1 mph over the prescribed limit.

    • Hope
      Posted April 18, 2016 at 7:14 am | Permalink

      The same for Rutte being ordered by the EU not to debate last weeks referendum to refuse Ukraine into the Schengen area per the overwhelming wishes of the Dutch electorate. This sort of arbitrary control needs to be exposed.

      Read Mr Rees-Moggs article about John Kerry and Joe Biden. Then ask why Obama is allowed to speak about the EU referendum!

    • Anonymous
      Posted April 18, 2016 at 9:04 am | Permalink

      I have sent my complaint to the BBC. I urge all others of like mind to do so.

      George Osborne’s claim that UK citizens would be poorer on leaving the EU (supposition) was given headline news. The ECJ’s ruling which makes our people poorer today (a fact, not a supposition) is given no coverage whatsoever.

      • Hope
        Posted April 18, 2016 at 6:45 pm | Permalink

        His spurious figures are based on 3 million extra migrants, also not mentioned. Tebbit is spot on the money.

      • yosarion
        Posted April 18, 2016 at 7:11 pm | Permalink

        This is the same Man that found Twenty Billion down the back of the sofa for his Autumn statement, but not only had he seemed to have lost it by the Budget, his predictions for the economy were Walter Mitty .
        Oh by the way George, you may wish to use a map of the United Kingdom in the future, I believe your family business is based in Eire, however they had this thing called the Easter Rising one hundred years ago, maybe you old Colonial boy’s did not do history at Eaton.

        • bluedog
          Posted April 19, 2016 at 12:07 pm | Permalink

          Osborne is not an Etonian. Fact check.

    • Posted April 18, 2016 at 9:41 am | Permalink

      The problem is that the BBC has the power (the studios, transmitters etc and lots of our money) while the OUT campaign does not.

      How do you know they have not already attempted to shame the BBC? What is the main platform for them to perform this shaming? The BBC of course…

    • Lifelogic
      Posted April 18, 2016 at 4:23 pm | Permalink

      The BBC are the only reason Cameron & Osborne have any chance of winning a remain vote. I still think they will lose despite this appalling BBC bias.

      Osborne is clearly getting very desperate. He now warns/threatens £36bn extra costs if the voters dare to vote for Brexit and leaves EU. It is clearly complete and utter tosh form top to bottom and a gross abuse by him of the treasury to try to fix the referendum result. He even threatens and income tax could rise by 8% and billions would be cut from public services if the UK votes to leave the EU.

      The man is despicable, worse even than Cameron. His minimum wage legislation in particular is hugely damaging and job destroying, his IHT threshold rating, his record peace time trade deficit, his near doubling of the nation debt, his huge PSBR, his endless hand over fist waste, his greencrap job exporting, expensive energy agenda, his pension pot muggings, his ridiculous sugar tax, his IPT tax increases, his enveloped dwelling tax, his attack on NonDoms, his huge stamp duty increases, the removal of personal allowances and child benefits for many, his absurd drivel about “morally repugnant tax avoidance” ….all show the man is totally unfit to be chancellor.

      His removal an replacement by someone who at least has a basis understanding of business, competitivity and the economy would provide a large boost to the economy, on top of all the benefits of leaving the EU straight jacket.

      He seem to think his job is to over tax, over borrow and have endless waste. To introduce political gimmicks and wearing a hi vis jacket and yellow hard hard at various factory photo ops – while talking complete and utter drivel.

      • Lifelogic
        Posted April 18, 2016 at 4:38 pm | Permalink

        Osborne rather reminds me of the hapless John Major, who threatened people by saying something like – if we leave the ERM interest rates will have to go up further just before it fell apart.

        Needless to say they fell to about half & very rapidly indeed. The economy recovered rapidly from Major’s self inflicted ERM strangulation ceased.

        Yet still no apology from the man and all those lost homes, marriages, businesses and suicides.

        Leaving the EU will certainly help the economy, less government, fewer regulations, more freedom and lower taxes always does. A sensible chancellor will follow too.

        The only positive thing I can find in Osborne is he is not quite as bad as John McDonnell – who we will probably get next if we do not vote Brexit.

  8. alan jutson
    Posted April 18, 2016 at 6:19 am | Permalink

    As I have said many times before on this site and elsewhere.

    The choice is not to compare the EU now with leave, it is to compare the EU as it wants to become with leave.

    Thus the future is not certain for either camp, but at least with leave we choose where we want to go.

    Not enough people realise what the EU has in store for its members in the next few years.

    Not a single interviewer (presenter) has yet picked this huge point up.

    Its as if the Five Presidents report has not even been thought of, let alone printed.

    The evidence is there, time for the leave side to use it with the example you have given today to prove it.

  9. The Active Citizen
    Posted April 18, 2016 at 6:21 am | Permalink

    Thanks for simplifying all of this JR. I read (well, ‘sped-read’) the EU Commission’s document when it came out. As you say this was ignored by the media.

    As usual you’ve come up with an understandable analysis. Once again the EU is claiming they want to simplify something and they want to do it quickly.

    After 30 years as a businessman, I find it hard to think of any examples where the EU has simplfied my life in business.

    And as for doing anything quickly – that’ll be the day. We’re 43 years into our membership and still the EU has no free trade agreements with the US, Canada, India, China, etc.

    • Lifelogic
      Posted April 18, 2016 at 6:52 am | Permalink

      Indeed simplification or any reduction in red tape, in regulations, in taxation, in energy cost are not something the EU ever does.

    • Colin Hart
      Posted April 18, 2016 at 8:01 am | Permalink

      And yet it seems perfectly possible for trade to be conducted between UK businesses and businesses in all the countries cited. Could it be that we overestimate the importance of free trade agreements?

  10. Denis Cooper
    Posted April 18, 2016 at 6:31 am | Permalink

    Off-topic but while I remember, JR, I wonder if you’d heard anything about a government spokesman recently telling farmers that if we leave the EU the Treasury might reduce or abolish farm subsidies? Somebody has mentioned this on a blog.

  11. Cheshire Girl
    Posted April 18, 2016 at 6:38 am | Permalink

    In my opinion, VAT is one of the worst taxes, as it is levied on so many things, including items which are essential, such as fuel and household repairs. It is far too high at 20 per cent. I am particularly annoyed when I consider a two night stay in a budget hotel, and I have to hand over 20 per cent to the Government for them to squander on some of their pet projects. Many would not be able to afford to do this, so no treats for them! This at the same time that the Government is bragging and boasting over the amount of Foreign Aid they are giving away. It seems they love rubbing salt into the wound. The fact that the rate is determined by the EU is just another reason to free ourselves from this organisation.

  12. Richard1
    Posted April 18, 2016 at 6:43 am | Permalink

    It is reported that Mr Osborne will announce today that the Treasury calculates a permanent cost of £4,300 p.a. In the event of Brexit. median household income in the UK is £21,000, so the Government must view Brexit as an unmitigated economic catastrophe – a 20% collapse in average incomes. As bad as the Great Depression. If this is the case why on Earth have Mr Osborne and others been prepared to have a referendum at all, if they think that one, quite possible, outcome is such a disaster? World leaders and finance ministers are also according to Mr Osborne, of the view that Brexit would be a global disaster. Presumably therefore in the event of a Brexit vote we can expect huge pressure on the EU to agree a proper renegotiation, reflecting the Uk’s position as permanently outsid the eurozone? Then I guess we will have another referendum.

  13. agricola
    Posted April 18, 2016 at 6:47 am | Permalink

    Why not just say that there was no renegotiation. It was a smoke and mirrors exercise that allowed Cameron to appear to be doing something when in fact he was doing nothing, because he had no desire to do anything. All that he required was that he was seen to appear to be doing something.

  14. Lifelogic
    Posted April 18, 2016 at 6:50 am | Permalink

    The BBC seem to be doing all the can to help the remain side on almost each and every news program. A typical BBC news report might be: Mr X the government minister for Y, said that the UK will have huge plagues of rats and our first born’s will all die should we dare to vote for Brexit. Cut to footage of Minister say exactly this in graphic terms for a minute or so. Then, their idea of balance, at the end with a three second statement:- “The leave side side this might not be quite correct” (without any footage or statement from them).

    If they want to further bias the pitch they bring in one of their “independent”, “experts” to attack any claims made by leave and defend any made by remain. This is done with an entirely superficial appearance of balance. Perhaps saying it will not actually be every single first born that dies, just the vast majority.

  15. Antisthenes
    Posted April 18, 2016 at 6:52 am | Permalink

    The EU is shutting down competition the life blood of any economy without it stagnation sets in and and people become poorer. Competition keeps the economy vibrant and those who do not learn the best practices from that competition in the end fail. No competition and failure is certain.

    The EU is supposed to be a market place where each member of that market can freely display and sell their goods and services. The consumer normally benefits from free markets as competition ensure best prices and quality but if the market is rigged so that all must adhere to the same standards then good prices and quality and even availability are far from guaranteed.

    By not letting nation states decide what business and government policies and practices they can use they are denying access to the consumer and citizen to the best priced and quality goods and services for the former and the right of self determination for the latter.

    The EU was set up by and for progressives (socialists and statists) and doing what any institution does when set up and run by them. It is dumbing everything down to the lowest common denominator so excellence is being discarded in favour of mediocrity. Competition is being replaced with protectionism and restrictive practices.

    Central planning and control has been tried many times and it has never produced good results. I do not see that the EU doing the same will make the result any different and so will in the end fail. Leave now and we will not be there when it does and so be less harmed by the getting there and it’s arrival.

  16. Know-dice
    Posted April 18, 2016 at 7:08 am | Permalink

    I don’t understand why the EU claims to have control over VAT rates, when it doesn’t even “unify” the VAT rates charged in the different countries of the EU…

    Rates vary from
    Luxembourg 17%
    to
    Croatia, Denmark & Sweden 25%

    http://ec.europa.eu/taxation_customs/resources/documents/taxation/vat/how_vat_works/rates/vat_rates_en.pdf

  17. Denis Cooper
    Posted April 18, 2016 at 7:08 am | Permalink

    I think it’s important that people understand that while we are in the EU our Parliament does not have complete control of VAT rates in the same way that it used to have complete control of purchase tax before we joined the EEC.

    However I also think that we may have to continue to put up with this for some time even after we have left the EU, because surely it is part and parcel of the EU Single Market?

    Another surge of propaganda from the government today, with Osborne’s claim that if we leave the EU then in 2030 the UK economy will have been shrunk by 6% and every family in the country will be worse off by £4300 a year.

    I turn to the Guardian for a repetition of the claims Osborne has made behind the Times paywall:

    http://www.theguardian.com/politics/2016/apr/17/brexit-uk-treasury-leave-eu-referendum

    and find that the 6% relates to the scenario where the UK has a Canada-style trade deal with its neighbours rather than being part of the EU Single Market.

    And:

    “The chancellor wrote: “The treasury analysis shows that under all plausible alternatives to British membership of the EU we would have a less open and interconnected economy – not just with Europe but, crucially, with the rest of the world. There would be less trade, less investment and less business. Leave the EU and the facts are: Britain would be permanently poorer. Britain’s families would be permanently poorer too.””

    Of course what he really should have said was “under all plausible alternatives to British membership of the EEA …”, but that option of leaving the EU but staying in the EEA is the one which would completely and obviously and irrefutably undermine the economic scaremongering from the government and its allies, and therefore the one that they were quickest to misrepresent and dismiss as an option.

    As I have said on an earlier thread I don’t give much credence to claims that a Canada-style trade deal would chop 5% 0r 6% off our GDP, because the EU Single Market is only worth about 2% of GDP according an estimate from the EU Commission, and it would have to be replaced by a pretty terrible alternative trade deal for that 2% gain to be reversed and with another 3% or 4% taken off for good measure.

    However proposing any alternative scheme which is demonstrably inferior to the EU Single Market does open the door wide for our opponents to make grossly exaggerated claims about the severity of the economic damage, and even if their claims can be refuted in detail that is a level of detail which is beyond the interest and understanding of most of the millions of people who need to be persuaded to vote to leave the EU.

  18. Ian Wragg
    Posted April 18, 2016 at 7:17 am | Permalink

    My wifes shop has just had the windows cleaned. Both men wearing leave EU tee shirts .
    I really am at a loss to find many remainiacs.
    We really need to get the public to see that Daves negotiations were a complete sham and are already unravelling

    The French finance minister says we are a minnow but the IMF says a Brexit will cause financial armageddom. Not bad for a minnow

  19. Treeza Indespair
    Posted April 18, 2016 at 7:21 am | Permalink

    Heard JR on Today programme this morning. The voice of reason. Calm, intelligent. He must be heard more widely. Why do the voices of unreason have such prominence ?
    I just can’t fathom why. What’s the underlying plan to it all.
    It’s obvious what is right and wrong.

  20. Denis Cooper
    Posted April 18, 2016 at 7:25 am | Permalink

    As is often the case it’s worth turning a blind eye to the invective and reading what Richard North has to say about this:

    http://www.eureferendum.com/blogview.aspx?blogno=86020

    “EU Referendum: Another look at Norway”

    referring to this article in the Sun from January:

    http://www.thesun.co.uk/sol/homepage/news/politics/6882592/Norway-urges-Britain-to-leave-EU.html

    “Top Norway MPs urge Britain to ‘be brave’ and join them outside EU”

    Even half a loaf is better than none at all, is it not, and whatever was agreed about the UK’s continuing membership of the EEA would not be set in stone forever.

  21. Nicholas Andrews
    Posted April 18, 2016 at 7:38 am | Permalink

    20% VAT rate was a conscious, political decision by this Conservative government, the party that Mr Redwood represents in Parliament. It is and was nothing to do with the EU. Exactly the same as when Geoffrey Howe increased, almost doubled VAT in the 1980’s. It is Conservative party policy, always has been. Or, am I mistaken and should I blame the EU for something your party always does when in office ?

    Reply The EU enforces a high minimum standard rate and prevents us exempting items from it.

  22. Colin Hart
    Posted April 18, 2016 at 8:06 am | Permalink

    Before I come to a settled view on this matter, I would like to know the Treasury forecast on the impact of this measure in 50 years’ time.

    • Leslie Singleton
      Posted April 18, 2016 at 6:51 pm | Permalink

      Dear Colin–I haven’t read this Treasury effort (instructed by Osborne of course so what’s the point?) but the 2030 date (ie many years hence) has obviously been used simply because if one works on basis of a constant 0.5 % (or whatever) the relative diminution each year (which is what the 200 pages boils down to) it is easy enough to come up with the putative big drop in household income by 2o30. I’ll bet somebody suggested carrying on the charade (so easy to do on Excel) till 2040 or 50, which at constant annual diminution (why not–sheep as a lamb?) would have looked even more “impressive” but I equally suspect somebody else said, hold on people have got to believe this–and with Cameron and Osborne doing the talking that will be difficult. Blindingly obviously it all depends on the assumptions. Supposing we were 0.5% better off each year? Sounds good to me.

    • libertarian
      Posted April 18, 2016 at 9:06 pm | Permalink

      Colin Hart

      ‘Before I come to a settled view on this matter, I would like to know the Treasury forecast on the impact of this measure in 50 years’ time.”

      Why? This would be the same treasury that a) Failed to see the banking crash a month before it happened b)failed to foresee the colossal rise in the number of jobs, c) predicts we will lose £4300 per person on Brexit. I think you’d be better examining chicken entrails

    • bluedog
      Posted April 19, 2016 at 12:13 pm | Permalink

      ‘I would like to know the Treasury forecast on the impact of this measure in 50 years’ time.’

      The first question to ask is this; ‘will there be a British treasury in fifty years time?’

      If Leave prevails, yes, of course. If Remain prevails, Britain will be forced to join the Euro and the Treasury will become an work-station in the EU Treasury in Brussels, probably within a decade.

  23. CHRISTOPHER HOUSTON
    Posted April 18, 2016 at 8:13 am | Permalink

    Off topic
    Mr Osborne: His £4,500 all seeing eye.

    If leaving the EU is a “Leap in the Dark” how come the REMAIN Campaign are so adept at seeing in the blackness? Are they bats, owls or ghouls?

  24. Bert Young
    Posted April 18, 2016 at 8:18 am | Permalink

    News of the present lack of control and the EU’s case to proceed further with the centralisation of taxes generally must be made known publicly . The Treasury made its statement today emphasising that every household would be £4300 worse off ; were we to have control over VAT , every household would probably benefit to the tune the Treasury indicates we would lose !

    Everyday there is some scaremongering story that is released ; everyday I cringe that there is little or no co-ordinated response . The organisation of the Brexit campaign has to get its act together more effectively in order for the public to obtain a proper balanced view . The facts are : Camerons’ negotiations were meaningless , we are exposed to ever closer union , we are controlled one way or another by the EU and our democracy has gone . Cameron has lost grass root support from the Conservative Party and he no longer represents a majority interest . As things stand the 1922 Committee should meet and remove him from office ; he has damaged the meaning of Parliamentary representation .

    This week sees the involvement of the USA in our political affairs . Brexit must put forward a proper onslaught to this interference at the right time and place . The Queen cannot refuse Obama a presence at her birthday on Thursday and the media is bound to dramatise whatever statements he issues . This is no time for Brexit to sit back and watch ; strong facts and objections must be stated to keep this influence in balance .

  25. Shieldsman
    Posted April 18, 2016 at 8:30 am | Permalink

    Vote.leave and the media miss all these points, you had better talk to the SUN.
    The BBC’s agenda is to remain in the EU.

    Well worth a read is Christopher Booker’s ‘the irrelevance of the EU’.

  26. alexmews
    Posted April 18, 2016 at 8:32 am | Permalink

    thx John. Good piece. i too am amazed the Commission report was broadly ignored given the centralising direction it took.

    I assume you and / or the broader Leave team will be on the media today rebutting the Treasury’s scare stories this morning. I don’t get how leaving the EU puts the NHS at risk or why our interest rates would need to ramp up drastically due to ‘economic uncertainty’. we do remain sovereign w/r/t our currency today and will do so on 24 June regardless of the result.

    Given the City by and large seems to be on the Remain side – have you seen any credible evidence that a Leave vote will see London hollowed out as Banks and the associated support industry in services will be required, for business or regulatory purposes, to relocate en masse to Frankfurt / EU from London?

  27. CHRISTOPHER HOUSTON
    Posted April 18, 2016 at 8:38 am | Permalink

    With so little work being done by the UK Parliament, there can be little reason why the Conservative and Shadow Cabinets and their supporting Civil Servants should not be cut back by 50% saving tax-payers money

    • Michael Wood
      Posted April 18, 2016 at 7:36 pm | Permalink

      This is what annoys me about the Remainiacs. If they are so keen on handing everything over to Brussels as per the Lisbon Treaty they should also take the obvious next step of dissolving Parliament as it is clearly no longer needed!
      Of course, they won’t do that; they don’t expect to have to give up their salaries and expenses while just twigg
      ling they thumbs to see if there is anything else left that they can interfere with

  28. stred
    Posted April 18, 2016 at 8:41 am | Permalink

    Off subject. R4 Today had you on first, which most of us missed, then Oborne and he gave his opinion. Nick Robinson actually did rather well in putting the arguments and brought out that the chancellor denied that the cost of this Treasury prediction is an unaccounted piece of propaganda at taxpayer’s expense. According to Oz the expense is just a factual prediction. When asked which immigration statistics were used he answered that NAO figures were used. And so they are assuming that immigration will continue, creating apparent growth for the period to 2030.

    MPs need to look closely at the calculation. Do the same EU Remain immigration figures apply to both cases, or do they assume that Out will mean less immigration? This would change the result. Dothey make a wealth calculation per household dividing by the greater number of households?

    If it turns out that the forecast is total tosh and propaganda, then Osborne should be prosecuted for breaking rules on referendum expenses. And not only should he lose his job, but those officials who are shown to have colluded in inaccurate, untrue and illegal propaganda should also be sacked, fined and not re-employed in the civil service.

  29. Antisthenes
    Posted April 18, 2016 at 8:51 am | Permalink

    So Dave and George have deployed another one of their big guns the Treasury and my word it has discharged a very large munition. In the shape of the enormous costly damage to every household it will cause if we leave the EU. The only armour we leavers can deploy against it is not very strong as it was not manufactured with the industrial might that government possesses. I do believe we cannot rally the population not to capitulate in the face of such a threat. Claiming rigged research and statistics will not hack it. Someone on our side has got to find a way to shoot it down and that spectacularly. If that can be achieved and it shoots to pieces the stayers claim then not only will this battle be won but the whole war as well.

  30. Posted April 18, 2016 at 8:51 am | Permalink

    Should we be surprised ?

    NO

    With the exception of very few MEPs like Dan Hannan and Nigel Farage, the whole edifice in Brussels is totally dedicated to the expansion of control over every area of life in Member states that it can possibly grab.

    No more than lip service is paid towards stated aims like subsidiarity which will never come to anything. Almost every EU Commissioner is selected because they are confirmed Europhiles and any doubters soon go native when they board the gravy train. To any proposed relaxation of control, The Commission will simply say that EU level is the lowest level at which that decision should be taken “to protect the single market.”

    Everyone in the National Governments knows that this is rubbish but goes along with it, partly because most of the ministers are Europhiles as well ( just look at the UK Government for proof of that ).

    Progress towards a United States of Europe is moving inexorably onwards, partially driven by the forlorn hope that they can centralise enough power to make the Eurozone work.

    That won’t succeed, of course : we have clear evidence that Eurosceptism is growing rapidly in most member countries, even core members like the Netherlands, Germany and France and Brussels is so arrogant that it will not move even one collective finger to accommodate the wishes of the people. As a result, the citizens of Eurozone countries will never vote for the massive transfer of Sovereignty necessary under a new treaty to create the political union necesary to make the currency union workable for the long term.

    For that reason I am probably a little more relaxed than many Brexit campaigners because in the end, after huge upheaval and financial damage, the whole edifice of the Euro will crash down around their ears.

    When the Euro shatters into two, three of four separate currencies, there will then essentially be up to four different EUs, all with their own differing political and economic needs. A perfect example of this will be trade deals : The UK, Germany and the Netherlands will want to conclude rapid trade deals with the USA. The French will certainly not.

    After the demise of the Euro I doubt whether the EU itself can survive as more than just a trading block which is what we wanted in the first place.

    So, if the British people mistakenly vote for Remain, it is certainly true that we will inevitably be sucked deeper than we would like into the vortex around an enormous black hole that will be a breaking EU but eventually we will get back most of what we have lost.

    In twenty years time we will probably have free trade deals with at least three of the four currency areas within what was the old EU but Sweden, Norway, Denmark, The UK and possibly Poland, will not be members of any of them.

  31. oldtimer
    Posted April 18, 2016 at 9:05 am | Permalink

    In one of his first speeches after the Brexit campaign starting gun was fired, Mr Boris Johnson stated that the EU was corrupt, citing its failure to produce any audited accounts. After twenty years or so, this failure is remiss not to say astonishing.

    Has any one tried to rebutt his statement that the EU is corrupt?
    It it was a business would any one invest in it? Indeed if it was a listed company on the stock exchange, would it even be permitted to solicit new funds from investors?

    Yet we are being told, through Project Fear, that we must continue to pay this corrupt organisation that cannot even do its sums properly and pass to it, with each passing year, yet more and more powers to extract impose new taxes and charges on the long sufferring British taxpayer!

    I now hear that Mr Osborne is saying, based on the work of his captive Treasury economists, that every family in the land will be £4000 a year worse off by 2030! This is a joke forecast. How does he or they know what is going to happen next year let alone in 14 years time? What assumptions do they make about the resolution of the EZ crisis? What assumptions do they make about all the new taxes the EU wants to impose on us and on the City? What assumptions do they make about the impact of technology on the way we live? What assumptions do they make about how many more millions of migrants will come to the UK under freedom of movement? What assumptions do they make about the costs these will these impose on the NHS, on schools, on building new housing stock? The answer, in all probability, is none. Because that would be a fools errand – just like the forecast he and his captive economists have just produced in their latest episode of Project Fear.

    In passing I note that the OBR, which Mr Osborne says is independent when it comes to his budget forecasts, is relatively neutral about the outcome of Brexit, saying the cost or benefit could go either way. Given the wide margins by which its forecasts of the UK economy can and do change in the space of a few months this is not surprising. The reality is that no one knows.

  32. Denis Cooper
    Posted April 18, 2016 at 9:12 am | Permalink

    http://www.theguardian.com/politics/blog/live/2016/apr/18/eu-referendum-osborne-treasury-brexit-will-cost-families-4300-a-year-politics-live

    “The Treasury’s document says British families could eventually be worse of by £4,300 a year if the UK adopted a Canadian-style free trade deal – as originally proposed by Boris Johnson. That is because a Canada deal would involve tariffs on services and some goods, at a long-term cost to growth. In his Today interview Osborne effectively threw down the gauntlet to Leave, saying that if they did not accept the Canada model as their preferred way forward, they would have to come up with another. Leave campaigners claim the UK could continue to enjoy free trade arrangements similar to the status quo, but Osborne dismissed this argument.”

    It’s surreal that the government with its army of civil servants and other resources is telling other people that they must come up with a solution to a problem of the government’s own making, especially as its unlikely that any of those other people will actually be in a position to attempt to implement whatever solution they may propose.

  33. fedupsoutherner
    Posted April 18, 2016 at 9:42 am | Permalink

    Some might ridicule your comments on the tampon tax but it is a prime example of how the EU will have direct control over taxes and charges in the UK in the future. As for putting up VAT on energy saving measures – beyond belief when they preach about how important getting our energy consumption down is. This action won’t help at all. I see today the BBC is going on about how every household will be worse off by 2030 by £4,000!!! What utter crap. Mind you, we might be if the EU put up our taxes etc. Apparently as soon as we leave the single market we will lose all our export trade. I had to laugh out loud. I just hope the public don’t believe the fairy tales they are being told but I know some will.

  34. Posted April 18, 2016 at 9:56 am | Permalink

    Ignoring the tampon tax is just another example of BBC bias.

    Last week (12th April 9pm BBC2) the BBC ran a tv show called “Europe Them Or Us”

    The very first statement in the program was:

    “It is the People – you – who must now decide whether Europe does mean ‘them or us’”.

    Nobody on the Leave side is talking in these terms. It is the BBC which is being divisive by putting out this provocative statement.

    It is also plain and simple bias as it characterises the Leave campaign as a battle between nations and peoples. All of the Leave spokespeople have stressed the importance of good relations with other nations and stressed that we will leave the eu and not Europe (the BBC still refuses to acknowledge the difference between the eu and Europe).

    As my complaints are always brushed aside by the BBC (their replies rarely deal with the complaint at all), I would hope somebody with a greater profile will raise this matter with the BBC.

  35. CHRISTOPHER HOUSTON
    Posted April 18, 2016 at 10:40 am | Permalink

    It must be admitted, many from both sides in any political argument perceive their own side as not being treated fairly by the media. Human nature.

    Yet long drawn-out presentations in today’s “Meet the Osbornes” where Mr Osborne and friends gave forth a fair satirical take-off of Sheldon and Amy’s “Fun with Flags” video, tops the lot in lack of balance and professionalism.

    Apart from a two-sentence edited soundbite from the LEAVE campaign on any one day, does the Leave Campaign exist to the media in anything but name?

  36. Paul H
    Posted April 18, 2016 at 10:45 am | Permalink

    I don’t know what you think gives you the right to pontificate on this matter. After all, according to George Osborne this morning, you and the rest of us Brexiteers are “economically illiterate”.

    Said the man who has failed by a country mile to meet any of his economic targets …

  37. Lifelogic
    Posted April 18, 2016 at 11:13 am | Permalink

    Max Hasting is surely right in saying today:- Our capital is set to pay dearly for Dave letting a posh-boy eco-nut be the Tory hope for mayor.

    http://www.dailymail.co.uk/debate/article-3545020/MAX-HASTINGS-capital-set-pay-dearly-Dave-letting-posh-boy-eco-nut-Tory-hope-mayor.html#ixzz46AwRrxoH

  38. acorn
    Posted April 18, 2016 at 11:15 am | Permalink

    JR, regarding the Treasury EU analysis, will the HoC Library come up with its own interpretation of this document? The Library recently wrote, “There is no definitive study of the economic impact of the UK’s EU membership or the costs and benefits of withdrawal. Many of the costs and benefits are subjective or intangible and a host of assumptions must be made to reach an estimate.”

    Being as the Civil Service works wholly and exclusively for the government “Executive”, this is looking like a very one sided debate. As I understand it, the Library staff are not Civil Service; and hence, appear to be the only data miners available to the “leave” side MPs. Do they get access to all source documents?

    It is events like this, that demonstrate how easy it would be, to turn our out of date, so called democracy, into a one party state. Parliament appears to be powerless to level the playing field!

  39. Chris
    Posted April 18, 2016 at 11:34 am | Permalink

    This summary of the main points of a government report slipped out just before the official campaign started last week demonstrates all too clearly the powers that we have given away to the EU, and how we can no longer be called sovereign.
    http://www.facts4eu.org/news.htm#16

    The link to the main government report is:

    https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/516501/Rights_and_obligations_of_European_Union_membership_web_version.pdf

  40. Mike Wilson
    Posted April 18, 2016 at 11:44 am | Permalink

    Mr Redwood, is there nothing you and the other Leave supporters can do to stem the tide of scaremongering from the people running your party. Now we are told income tax will go up 8p! Soon, presumably, we will be told sea levels will rise 10 feet. Some daft souls will believe this endless propaganda. Surely, on a matter of such huge constitutional importance, there must be some legal way to stop people in positions of power (i.e. employed by or in the government) to stop making unfounded statements.

    I do hope the Leave campaign have some sort of campaign in mind. All that’s happening at the moment is the Remain campaign are making more and more absurd statements. They are widely covered in the media and the Leavers are treated as village idiots – particularly by the BBC.

  41. Ken Moore
    Posted April 18, 2016 at 12:01 pm | Permalink

    Good to hear you on BBC radio 2 today.
    It would be interesting to hear your view on the 44% trade figure with the Eu quoted – I was surprised not to hear mention of the fact this is skewed by the ‘Rotterdam effect’ and the large number of goods Uk goods re -exported through Europe.

    I disagree with your assessment of Mr Osborne – he is not wrong – selling us down the Eu sewer is better for his own career and self interest of his and a few cronies. A liar yes but not wrong. He knows that the Eu is good for a select few but very bad for many others. He simply does not care.

    Speaking of cronies Mr Crabb has obviously been leaned on heavily and spoke with all the conviction of a man who owes his career to patronage.

  42. Lifelogic
    Posted April 18, 2016 at 12:01 pm | Permalink

    Kwasi Kwarteng MP did a pretty job on the Daily Politics today for leave. Even if he does oddly seem to think the Cameron could lead the post Brexit vote, negotiation.

    Will we get a new Independence Day, Bank Holiday on 23rd June post the Brexit vote. I think we should do it is a nice time of year for a bank holiday.

    • Lifelogic
      Posted April 18, 2016 at 6:38 pm | Permalink

      Also it is, but for a minute or so, the longest day of the year. Perfect for a nice long sunny independence day. Freedom at last from anti-democratic bureaucrats and Brussels, free from Heath, Major and Cameron and the rest of the dreadful No Nation Tories.

  43. Atlas
    Posted April 18, 2016 at 12:05 pm | Permalink

    Stightly off topic:

    I wonder if the Treasury’s ‘project fear’ projection is anymore accurate than its projections for growth, which Osborne keeps having to come to Parliament every few months to ‘correct’?

  44. Graham Elliott
    Posted April 18, 2016 at 12:07 pm | Permalink

    It should have been reported in the media, as was true when the plans for the new system applicable to supplies of downloads was being agreed to by all Member States yet, when introduced many months later, came as a shock to small businesses that were caught up in it. However, this is intended to give more control back to member states, but subject to issues which any sensible government would in any case want to take into account. It is not indicative of greater control than the present. But exit would of course give greater control still (or at least, that is the theory).

  45. hefner
    Posted April 18, 2016 at 12:21 pm | Permalink

    As said by Bernard Jenkins, Osborne’s forecast to 2030 when anything to next year is very likely to be revised, is useless and rather ridiculous. But I would think there is some urgent need from the Leave side to produce some one- or two-year precise road maps for different “divorce” scenarios.

    Right now, I am afraid we are just given sound bites, showing off how clever some people might be, but nothing more than words.

    It is much worse than any other “normal” elections.

  46. Antisthenes
    Posted April 18, 2016 at 12:24 pm | Permalink
  47. oldtimer
    Posted April 18, 2016 at 12:43 pm | Permalink

    I have just heard Mr Steven Crabb trying to defend Mr Osborne’s forecast that each family will be £3400 a year worse off if we vote for Brexit. He notably failed to answer (as is to be expected from any politician worth the name) any of the pertinent questions put to him. Instead (as is to be expected from any politician worth the name) he sought to deflect the question or change the subject. However, if I heard him correctly, the forecast includes an increase in the population of 3 million because of immigration because of freedom of movement rules. He sought to imply that Brexit would still require freedom of movement! He totally avoided any further examination of the assumptions that underlie the Treasury numbers.

    I also heard Mr Osborne claim that this was about “facts”! Whereas it is all about forecasts and the assumptions on which those forecasts are made. At least the BBC economics correspondent did point out that the forecasts (or “facts” per Osborne speak) made in 2000 totally failed to predict the financial crash of 2008.

  48. David Edwards
    Posted April 18, 2016 at 12:53 pm | Permalink

    I still keep trying to understand why Remain are so anxious that we remain. George’s announcement today is essentially “don’t you worry about it”, leave the thinking to us and hence the rather superficially complicated equation that the treasury has released, which really just adds a few things up and multiplies by risk factors, all of which are arbitrary, depending which numbers you put in. My latest theory is that George persuaded Dave to support the EU because it would be in George’s best interests. Dave has gone along with it but now gets very angry a lot of the time because he’s realised that Remain may very well lose, and if they lose Dave’s political career is over, as is George’s career. But both are arguing for something they don’t really believe in, which is why they get tripped up all the time and create such specious/questionable arguments.

  49. Margaret
    Posted April 18, 2016 at 1:15 pm | Permalink

    I will be brief. “Knickers” to the EU remain pessimists ( Johnson.B, 2016)

    • Margaret
      Posted April 19, 2016 at 8:59 pm | Permalink

      god, so embarrassed the full stop and comma are in the wrong order…that surely is a fail and will affect how I carry out clinical duties.

  50. NickW
    Posted April 18, 2016 at 2:38 pm | Permalink

    Fraser Nelson debunks Osborne’s fabrications;

    http://blogs.spectator.co.uk/2016/04/the-deceptions-behind-george-osbornes-brexit-report/

    Missing from these calculations is the fact that to arrive at a GDP per household figure, it is necessary to make assumptions about the number of households.

    Given uncontrolled immigration and the differential birthrate it would be reasonable to make the assumption that the number of households would have doubled by 2030, ergo, if we remain, household incomes will halve.

    Osborne’s equations are utterly meaningless without proper validation and proof. We also need a list of published assumptions. When we see those assumptions, we will be able to better judge the applicability and validity of the calculations.

    It took an Einstein to validate “e=mc2” and we can therefore safely assume that the published equations have no connection whatever with reality.

  51. Jack
    Posted April 18, 2016 at 3:05 pm | Permalink

    Hopefully we can take back our monetary sovereignty in full and start putting it to good use by not only cutting VAT on energy, but freeing ourselves from the 3% budget deficit limit and cutting taxes more generally.

    Initially it’s likely that the pound will go down, but the fact that the government won’t be making large net payments to the EU over the foreign exchange window should dampen that down a bit. And a currency-issuing government can always maximise domestic real resource use and sustain full employment at all times. We just need to make sure we maintain our trade relationships and have a stable transition into EFTA or something like that.

  52. Alte Fritz
    Posted April 18, 2016 at 3:19 pm | Permalink

    If we think very very very VERY hard about this, we will all surely understand that this situation is just one of the innumerable benefits of membership. (Somewhere along with the £60bn trade deficit with the single market.)

  53. JoeSoap
    Posted April 18, 2016 at 3:29 pm | Permalink

    You might like to comment on your Chancellor’s selective use of statistics to make his case against yours. I am still struggling to know how you can share a side of the House, let alone party, with these people.

  54. NickW
    Posted April 18, 2016 at 3:54 pm | Permalink

    Having read some of the Treasury report, it would appear that all the projections are based on constant population size.

    It would appear that there has been no recognition of the fact that continued membership of the EU will result in substantial population growth, increasing the cost of health, schooling and welfare, reducing wages and tax receipts. One can see why the Government does not wish to put a figure on, or even mention the population increase which comes with EU membership, but it makes the report worthless.

    There is an assumption that non EU Trade will be reduced which is highly questionable.

    On Brexit, if the EU wants to play dirty, we stop buying from them and arrange mutual import and export deals outside the EU. We can buy cheaper and our non EU Export Trade will grow, not shrink.

    To sum the report up, it says “Let us assume that GDP/ Trade will fall by x%; how much worse off will we be?”

    All the assumptions are pessimistic and unvalidated; pure guesswork.

  55. Jagman84
    Posted April 18, 2016 at 4:38 pm | Permalink

    I cannot see why the EU should have any input regarding our finances, other than our ‘membership fee’. Matters, such as the setting of VAT rates, should only apply to the Eurozone members. The UK’s participation in EU bailouts should be totally out of the question.

    • Posted April 18, 2016 at 8:17 pm | Permalink

      The EU uses protection of the single market as their excuse for taking control of everything they can take away from member states.

      We can buy goods (other than new or nearly new cars, boats and planes ) from any other EU country, paying the VAT in that country rather than our own.

      For that reason, Brussels have taken control of VAT rates and, while they will allow member states to increase rates of VAT, they will not allow them to be reduced.

  56. Denis Cooper
    Posted April 18, 2016 at 5:37 pm | Permalink

    I notice that on page 5 of the Treasury analysis:

    https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/517155/treasury_analysis_economic_impact_of_eu_membership_web.pdf

    there is a statement that: “It is widely accepted that leaving the EU would mean a new relationship based on one of the following models … No country has been able to negotiate any other sort of deal, and it would not be in the EU’s interest to agree one.”

    And there is a similar assertion on page 8: “No country has been able to negotiate a better deal and it would not be in the EU’s interest to agree one with the UK.”

    Which is a bit odd, really, as I would have thought it would be very much in the EU’s interest to avert the “severe regional and global damage” which the IMF has just predicted could result from the UK’s exit from the EU “disrupting established trading relationships”, as mentioned a little further down on the same page.

    • matthu
      Posted April 18, 2016 at 6:40 pm | Permalink

      Furthermore, is it not self-evident that any member of the government who at the very outset “widely accept” that there is no other option other than to submit to one of those negotiated outcomes that have previously been negotiated by far less significant trading partners than the UK, almost by definition rules themselves out of being part of any negotiating team going forward?

      (We have already witnessed what happens when you go into a negotiation having already announced that you do not intend to walk away from whatever morsel your adversary offers you.)

    • Lifelogic
      Posted April 18, 2016 at 6:43 pm | Permalink

      Surely the deal with the EU should be to let them decided on the total import tax as an average % and the UK can then have the same rate for them. That way we make a net profit as we import far more than they do. Unless they choose zero tax, then we are quits. That would be their best option.

  57. Margaret
    Posted April 18, 2016 at 5:47 pm | Permalink

    How can leaving the EU cost families £4,500 PA ?

    • matthu
      Posted April 18, 2016 at 6:42 pm | Permalink

      By ignoring all positive contributions from getting out and assuming that there won’t be any economic risks from remaining within the EU.

    • Lifelogic
      Posted April 18, 2016 at 6:45 pm | Permalink

      Leaving would certainly be a net benefit to the UK. It is a blatant lie. If Cameron and Osborne will on the basis of this absurd pack of, tax payer funded, lies then they will split the party in two.

    • alan jutson
      Posted April 18, 2016 at 6:46 pm | Permalink

      Margaret

      That is nearly the entire State Pension for one person, what a load of absolute cobblers.

      The remain team are now making themselves look like the absolute fools they really are.

      Time for someone to force them to reveal the calculations.

    • Chris
      Posted April 18, 2016 at 7:08 pm | Permalink

      It wouldn’t. Fraser Nelson is one among many who is not impressed – from Coffeehouse, Spectator:
      “…..sometimes, George Osborne’s dishonesty is simply breathtaking’, and points to two deceptions from the Chancellor.
      The first is that Osborne falsely claims that people would be ‘permanently poorer’ when he’s talking about the difference between 29pc GDP growth and 37pc GDP growth. The most he can claim is that they won’t be as much better off as they would otherwise be. The second deception is Osborne translating this reduction in potential GDP to household income – but they are two fundamentally different things. This, writes Fraser, is ‘Osborne’s crowning deception’. “

    • Ken Moore
      Posted April 18, 2016 at 7:49 pm | Permalink

      Indeed, and which ‘family’ is this. An average family perhaps. How do they define the average family ?.
      Any why do they feel confident enough to predict the amount to the nearest hundred pounds. ?.
      Without a shadow of a doubt this Conservative government is the most incompetent, dangerous,self serving and cynical administration of recent times.

      Taking us into a bloody war on the word of a liar is bad enough but blocking the escape route from Eu slavery by publishing dodgy dossiers takes the biscuit. JR you must feel ashamed of the leadership of your party and bitterly regret endorsing Mr Cameron as leader ?
      Perhaps you could be a little more outspoken in your criticism of your party leadership although I know that is asking a great deal when you have already done so much . You were right on the ERM the Euro…..why aren’t the leadership now in ‘listening mode’. Perhaps you and others need to turn up the volume…..

    • CHRISTOPHER HOUSTON
      Posted April 18, 2016 at 8:43 pm | Permalink

      For a Chancellor who publicly for years used the terms “deficit” and “debt” without knowing regard to the less than subtle difference between the two, his £4,300 PA may very well simultaneously indicate the amount of money ones Pa should contribute to a wedding ceremony with potted meat sandwiches and pickled eggs ( as many as you can eat ) for the reception.

  58. Lindsay McDougall
    Posted April 18, 2016 at 6:04 pm | Permalink

    Why is each Member State not allowed to levy VAT at rates between 0% and 30% on whatever products and services they wish to?

    We have yet another demonstration that the Single Market and free trade are not the same thing.

    Free trade within the EU was at its peak after the passage of the Single European Act and the subsequent treaties have ceded more power to the EC and made trade less free, all in the name of ‘completing the Single Market’.

    You now have something bigger and more preposterous to get your teeth into, namely George Osborne’s ‘forecast’ of how much poorer we will be in 15 to 20 years time if we adopt a Canada style deal.

    The Canada style deal has low tariffs on industrial products (being phased out over 7 years), it has higher tariffs and prohibitions on agricultural products – but we can get much cheaper food from non-EU countries, and some restrictions on services. However, UK services exports to the EU constitute only 4.6% of our GDP (slowly declining as a %), and the Single Market does not enhance them.

    At least the Chancellor has accepted that we want a Canada style deal – a proper divorce that enables us to cancel our contributions to the EU budget – and not a deal like those of Norway or Switzerland.

  59. stred
    Posted April 18, 2016 at 6:21 pm | Permalink

    re the Treasury figures. Having just skip read it and reached for my calculator,

    Immigration/ GDP estimates- no figures for input, only a POPit x POPjt in a large equation with many trade estimates etc

    Figures for GDP given as 0.7 gross (after rebate?) less 0.3 = 0.4 ie 42% and 57%
    Actual figures for 2014- 14.4bn gross after rebate less 4.6= 9.8 ie 32% and 68%
    Ditto estimated 2015- 12.9bn gross after rebate less 4.4= 8.5 ie 34% and 65%

    In other words Treasury estimate we will be paying less qand be given more back in the future. Yet we will be growing with more population and therefore be asked to increase our contributions. Please explain.

  60. Denis Cooper
    Posted April 18, 2016 at 7:49 pm | Permalink

    I’ve just searched through the Treasury analysis for the words “Single Market” and found that there are 290 occurrences.

    But I haven’t found one which says in plain terms how much it has enhanced our GDP.

    Plenty on how it has increased trade and investment, indirect indicators, and loads on what increases in GDP might possibly be gained by improving it in the future, provided we stay in the EU of course, but not a single reference to what the Single Market has actually done for us so far in terms of extra GDP.

    Maybe that’s because the answer seems to be “Not a lot”, it appears that the Single Market has added about 2% to GDP, averaged across the EU as a whole, and with the UK as one of the countries which has actually benefited least according to this report:

    http://sputniknews.com/europe/20160418/1038194260/brexit-impact-germany-loss.html

    So how it works out that all the alternatives to EU membership with access to the Single Market would allegedly cost us far more in GDP lost than we have ever gained from that same Single Market is a bit of a mystery.

  61. Monty
    Posted April 18, 2016 at 7:59 pm | Permalink

    The treasury report is making some rather imaginative assumptions for the Remain case. The one that jumps out to me, is the assumed net migration. They are forecasting this will fall to 180,000 pa by 2021. Further, they are assuming that we would be permitted to enforce our 4-year benefit embargo for new arrivals. Both of these seem fantastic to me. For the latter we have no guarrantee at all, and the former immigration rate is untenable in the face of the tide of immigrants entering Europe from the MENA region and the promised visa relaxations for Turkey. We would have to endure another immigration boom, and this would prove extremely costly, and damaging to our public services and national security. Yet their economic projection takes no account of this.

  62. Ken Moore
    Posted April 18, 2016 at 8:17 pm | Permalink

    George Osborne today broke new ground in the age of political lying it’s just disgusting. GDP and household income are not the same thing !!. ..and you can’t extrapolate 20 years forward and assume the population will be the same with net migration at 300,000 plus.

  63. hefner
    Posted April 18, 2016 at 8:29 pm | Permalink

    In August 2007, John Redwood and Simon Wolfson produced a 211 page report “Freeing Britain to Compete: Equipping the UK for Globalization”.
    A similar report, or at least an update based on this would be very welcome.

    The noises made this morning by the Brexiteers were rather ridiculous if they are unable to come up with anything equivalent to George Osborne’s 201 page document.

    Reply writing 200 pages of nonsense like the government one would be foolish. No one can forecast detail over fifteen years.

    • hefner
      Posted April 19, 2016 at 6:07 am | Permalink

      What about a one- or two-year road map, stating what model, Switzerland, Norway, Iceland, Canada, other, you intend to follow?

      By the way, were your 2007 211-page document all nonsense? It didn’t look like it to me!

  64. Original Richard
    Posted April 18, 2016 at 8:41 pm | Permalink

    It is not generally realised that a large proportion our government collects in VAT is handed over to the EU.

    For this reason it is to be expected that any EU VAT “reforms” will see the end of zero rated and exempt rates on many items such as food, printed matter, travel, postage etc.

  65. bluedog
    Posted April 18, 2016 at 9:27 pm | Permalink

    Off topic, Dr JR. The article by Sir Lynton Crosby in the DT is very bad news, and likely to create a band-wagon effect. If it is true as reported that 2/3 Conservative MPs are Brexiteers, now is the time for a consensus to depose Cameron as PM. Without him, Remain folds. A Brexit PM can starve Remain of funding and can brief in favour of Leave.

  66. stred
    Posted April 18, 2016 at 9:59 pm | Permalink

    P erhaps the most ridiculous argument to Stay is that the EU regulations for manufacturered products would suffer if we could not comply with EU ( or any other ) regulations.

  67. Posted April 19, 2016 at 12:28 am | Permalink

    Why doesn’t the EU simply have to change the law to allow us to alter our VAT rates?

    Because the EU is a law unto itself, is no respecter of individuality, and is entwined with the United States to the higher purpose of the subjugation of nations as a part of the establishment New World Order agenda?

  68. Posted April 19, 2016 at 8:04 am | Permalink

    Hopefully someone, somewhere is working on the cost of the extra infrastructure and housing costs associated with Osbourne’s prediction that our population will increase by an additional 3m over the next 14 years if we remain in the EU.

    I cannot believe that the vast amount of money that would need to be spent to even maintain public services at their current level would be remotely affordable, or even possible, given the fact that most of the new arrivals will want to live in the South.

  69. Jac Flynn
    Posted April 19, 2016 at 5:53 pm | Permalink

    You may or may not be aware that:

    “On 7 April 2016 the Commission adopted an Action Plan on VAT. Towards a single EU VAT area. The Action Plan sets out immediate and urgent actions to tackle the VAT gap and adapt the VAT system to the digital economy and the needs of SMEs. It also provides clear orientations towards a robust single European VAT area in relation to the definitive VAT system for cross-border supplies and proposes options for a modernised policy on EU rules governing VAT rates.”
    http://ec.europa.eu/taxation_customs/taxation/vat/action_plan/index_en.htm

    From that website I quote: “the degree of autonomy on rates to be granted to Member States is not purely a technical matter, but requires political discussion. The Action Plan aims at initiating such political discussion with the Member States in the Council, as well as in the European Parliament to allow the Commission to submit, in 2017, detailed legislative proposals based on a mandate from the Council.”

    Additionally from:
    http://europa.eu/rapid/press-release_IP-16-1022_en.htm

    “The Commission plans to modernise the framework for rates and to give Member States more flexibility in future. It proposes two options: one option would be to maintain the minimum standard rate of 15% and to review regularly the list of goods and services which can benefit from reduced rates, based on Member States’ input. The second option would abolish the list of goods and services that can benefit from reduced rates. ”

    Sir, we are fast moving towards a supranational EU wide VAT rate and EU wide taxation rate over which our chancellor and treasury will have little say, unless we brexit.

    Tampons are the tip of the VAT iceberg!

  70. Steve
    Posted April 19, 2016 at 7:02 pm | Permalink

    Probably one reason the EU forbids removal of VAT and is reluctant to authorize reductions is that it takes a cut of all VAT collected by the various member states.

    Between 2017-2013 we paid over £15.4 billion in contributions – 18% of the EU’s VAT revenue, despite our population being only 13% of the entire EU.

    Are these VAT payments counted in our ‘membership fee’? If not then that’s something else the Leave campaign should be highlighting as a massive additional cost. I’ve not seen it mentioned at all recently in the various arguments over how much the EU costs us.

    Many thanks for your blog and your excellent articles John, they’ve been very informative and easy to understand, and have provided good ammunition for discussions I’ve had with remainers.

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, He graduated from Magdalen College Oxford, has a DPhil and is a fellow of All Souls College. A businessman by background, he has been a director of NM Rothschild merchant bank and chairman of a quoted industrial PLC.

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