Léim ar aghaidh chuig an bpríomhábhar

Dáil Éireann díospóireacht -
Tuesday, 12 Dec 1972

Vol. 264 No. 6

Ceisteanna—Questions. Oral Answers. - Price Increases.


asked the Minister for Finance his Department's estimates regarding price increases on foodstuffs and household goods following the introduction of VAT; and if he will state the estimated price increases in these categories for the year ending 30th November 1973.


asked the Minister for Finance if his Department have formed estimates of probable price rises in household and food items following this country's entry into the EEC in January next; and if he will indicate these estimates and the probable extent of such price increases.

I propose, with your permission, a Cheann Comhairle, to take Questions Nos. 50 and 51 together.

The value-added tax applies to food and other essentials at exactly the same effective rate as that which applied under the former sales taxes and it was, accordingly, estimated that the introduction of the tax would not be a factor in causing the prices of these commodities to rise.

With regard to certain household goods, constituting a relatively small fraction of household expenditure, it was not possible to align precisely the incidence of the VAT with that of the former taxes. It was expected that there would be a need for minor price adjustments in such cases which should not, however, affect significantly the level of prices generally.

It is not possible to assess precisely at this stage the likely overall increase in 1973 in the price of food and household items arising from EEC entry and other factors, including normal market forces. In this regard, I would refer the Deputy to my reply to Deputy O'Leary on 14th November in which I agreed with the general tenor of the Economic and Social Research Institute view, published in the Quarterly Economic Commentary for autumn 1972, that food prices seem likely to rise in 1973, although not so rapidly as in 1972. The rise in nonfood prices has slackened off considerably during this year and it is hoped that this trend will be maintained in 1973.

Would the Minister not consider the estimated increases, or what they might be, on our entry into the EEC?

It is not possible to do it on a detailed basis in regard to such a widespread number of items.

Is the Minister aware there is some confusion in housewives' minds as to the exact prices of foodstuffs because some manufacturers are including the tax and others are not? This makes it very difficult for housewives to make comparisons. Would the Minister consider issuing a directive to manufacturers that they should state whether the price marked on a packet is inclusive of tax?

I take it the Deputy is referring to the recommended price of manufacturers?

I would have to examine whether it is possible to do what the Deputy suggests. I have some doubts as to whether it is possible or, indeed, desirable to do so.

Would it not be possible to direct manufacturers to recommend prices that are inclusive of tax?

I will look into it. I have some reservations as to whether it is possible or desirable.