§ Sub-section (3) of Section forty of the principal Act (which provides amongst other things for the reference of certain matters for the decision of a board of referees), shall, where the application for such a reference is made in respect of a trade or business carried on in a controlled establishment within the meaning of Part II. of the Munitions of War Act, 1915, and relates to an accounting period during any part of which the establishment has been so controlled, and to the postponement or suspension of renewals, or repairs, or to exceptional depreciation, or obsolescence of assets, or to the necessity in connection with the present War of providing plant, have effect as though a Referee or Board of Referees appointed or designated by the Minister of Munitions for the purpose were substituted for the Board of Referees under the principal Act.
§ Clause brought up, and read the first time.
§ Motion made, and Question proposed, "That the Clause be read a second time."902
§ Mr. McKENNA
This is a Clause carrying out what I undertook to do in regard to controlled firms in relation to the Excess Profits Duty. Generally speaking, the proposal that I made did not require any amendment of the Act, but it did require an amendment of the original Act in order to transfer the jurisdiction of the Board of Referees under the Excess Profits Duty to the Board of Referees under the Munitions Act, The purpose, of this Clause, therefore, is to give to the authority under the Munitions Act the power of finally determining the amount which is to be allowed for depreciation, renewals, repairs, and all the other items contained in this Clause.
§ Mr. McKENNA
Yes, it is on the Paper, and I thought the Committee was so familiar with the arguments that we have had on two days of this week and last that it would not be necessary for me to say anything further on the subject. It is an Amendment of Section 40, Subsection (3) of the Finance Act of last year. It embodies the arrangement I undertook to give effect to with the Munitions Department in regard to controlled firms.
§ Mr. J. MASON
Do I understand the right hon. Gentleman that this Board of Referees will settle the whole question as to exceptional depreciation and so forth in connection with both the Munitions Department and the Excess Profits Tax and at the same time? Is that what this Clause will do—that one Board of Referees will settle these allowances for both taxes at the same time?
§ Mr. McKENNA
Perhaps I should have made the point, but I thought it was already clear to the House. Under the Excess Profits Duty there are certain allowances for renewals, depreciation, etc. Under the Munitions Act there are, in respect of controlled firms, similar allowances. Allowances are made in accordance with different rules and might not come to the same amount, and if objected to, there is an appeal to two separate authorities. Inasmuch as I have undertaken that in all these matters I shall accept the finding of the Ministry of Munitions, it became necessary to oust the jurisdiction of the Board of Referees in relation to the Excess Profits Duty and to substitute for it the jurisdiction of the Board of Referees under the Munitions Act. That is what this Clause does.
§ Mr. STUART-WORTLEY
The right hon. Gentleman gave a kind of promise earlier in the stage of these discussions as to goodwill. That promise was given after this Clause had been put on the Paper. I hope that the fact that this Clause does not mention goodwill does not mean that we are not to get some concession.
§ Mr. McKENNA
Oh, no! The question of goodwill would not come into this Clause. It would not come before the Board of Referees under the Excess Profits Duty, nor would it necessarily come under the Munitions Act. It might be a separate authority altogether. It will not arise until after the War. It is not necessary to include it here. The promise, of course, stands good.
§ Question put, and agreed to.
§ Clause read a second time, and added to the Bill.