§ It is hereby declared that the new import duties on cinematograph films shall not apply to negative films brought into the United Kingdom where it is proved to the satisfaction of the Commissioners of Customs and Excise or where the importer makes a declaration that such film contains only exposures of scenes which are intended to form part of a production of which the other scenes have been or are to be exposed in the United Kingdom. Provided, however, that if the blank film used outside the United 476 Kingdom was not previously obtained from the United Kingdom the duty at the rate appropriate to the blank film shall be charged, levied, or/and paid as though such film were being imported.—[Mr. Newbould,]
§ Brought up, and read the first time.
§ Mr. NEWBOULDI beg to move,
That the Clause be read a second time.I believe this Clause has only to be understood to commend itself to all sections of the House, it may be necessary for me to make some few explanatory remarks before I come to the direct law of the Clause, it is generally understood, or believed, at the present time that the cinema industry in this country is in a very flourishing condition. That is not in any sense true; but the popularity of the cinema is great, and much greater than at any time, and the attendance probably is very much greater than it has ever been. The Committee will realise that during the five years of war there has been no development of any sort in the industry. Manufacturing film places have been closed down, and we are five years behind other countries, and our largest competitor, America, in the development of productions. The British producer wishing to take scenes in France or anywhere in its natural setting provided by the scenery sends his company, the producer, his camera men, and so on, to Italy, or France, as the case may be, to film the scene. The finished total may only be 5,000 feet. He requires 1,000 feet taken in France in the natural setting and surroundings of the story. He sends his company to secure that 1,000 feet, and he has to expose anything up to 10,000 or 12,000 feet. The thing is brought back to this country. It is edited in the studio. It is put together with the other 4,000 feet taken in this country When the producer brings that film back from France he pays 5d. per foot duty on the total length of it, although, in fact, he is only going to use 2,000 or 1,000 feet of it.First of all I contend that this is not really an import at all. It is part of a British manufactured article. What you are in effect taxing is foreign scenery, or if you are not taxing that foreign, scenery, or some particular spot in France, in Paris or Rome, then you are endeavouring to tax the sun because of the light which enables you to take the film. I am surprised, I must say, that my right hon. Friend has not accepted this Clause, which seems to me such an act of 477 justice that it has only to be understood to be accepted without any discussion whatever. I do not desire to prolong the discussion if I could get some announcement from the Chancellor that he has favourably considered this proposed Clause. I cannot imagine any argument why it should not be accepted. Personally, I am in favour of the abolition of all taxes on imported things. In this country we require films from all the other countries in the world freely imported. The concession I am asking has no relation to taxation. It is merely to allow British manufacturers to produce the whole of a British article without taxation. The position at the present moment is that the British manufacturer has actually to pay two or three times more duty on his finished article than has the foreigner. The whole situation seems to me to beso absurd that I can only believe it is not understood. There is no reason why London should not become the film centre of the world. Owing to the vast influence which it ought to have, we do hope, if the world is to be informed and educated by films, that there should be amongst these films a very large number of British make, so that British ideas and customs shall go all over the world. It is very important indeed that the manufacturer of films should be encouraged in every possible way in this country. Instead of the British manufacturer being helped by the Government in establishing his business he is actually hampered, being placed at a disadvantage with the foreigner. I am not prepared to pay a duty which is not paid to a like extent by my competitors. I would like to hear what the Chancellor of the Exchequer has to say on this point, and I feel that if hon. Members really understood the importance of it there is no doubt the sympathy of the House would be in favour of this proposal.
Mr. CHAMBERLAINThe hon. Member seems to have produced an argument which does not quite fit his own Amendment, and it seems to be a speech which refers to an Amendment which he moved last year rather than the one he is now moving. The Leader of the House last year found himself unable to accept the hon. Member's proposal, and the same objection extends to this proposal. The duties are 5d. a foot on negatives, Id. a foot on positives, and a ⅓d. a foot on blank films. What ho means when he says 478 the British manufacturer is taxed more than the foreigner I do not understands The hon. Member proposes that films used in photographic scenes abroad as part of a film of which some part is photographed here should be admitted at a duty of ⅓d. in respect, not on the whole film, but only of any part which is a foreign blank film.
§ Mr. NEWBOULDI quite believe this Clause is not understood by the right hon. Gentleman. If the blank film is taken from this country to be exposed in another country it has already paid the ⅓d. It is not manufactured here, but the great majority of it is imported into this country. If you produce the blank stock in the country and you wish to expose it and bring it back here, it should be subject to a ⅓d. per foot, but it is subject to 5d. per foot.
Mr. CHAMBERLAINIf the film is. produced here it has no duty to pay whatever, but if the film is produced elsewhere it pays a ⅓d. per foot. If it is negatived it pays 5d. per foot; but it does not pay twice over. What the hon. Gentleman proposes is that any foreign-produced film developed to the negative stage abroad shall enter at the rate of duty of blank films provided it forms part of the complete film, some of the scenes of which have been produced in this country. Take, for example, "A Tale of Two Cities." Some scenes are produced here used some in Paris. The film made abroad with the scene enacted abroad is to enter as if it were a blank film at the blank film rate, because it is to form part of the film with the scene, for example, at the Central Criminal Court in London. That would be reducing the duty to an absurdity. The hon. Member spoke of British interests and British producers, but that is much wider than his speech, and that was what I meant when I said his speech applied more to his proposal of last year than this one. This Clause would enable you to bring in any film provided only an odd 100 feet of it happened to be a scene in this country, and I could not possibly accept such a proposal, because it would destroy this tax.
§ Mr. NEWBOULDThere is still some confusion of thought on this matter. I am a British manufacturer of films and not of film stock or blank film or the raw material on which we print the pictures. I am a manufacturer of pictures. I de 479 sire to produce in my studio, for example, A Tale of Two Cities," and I find that some of these scenes have to be taken in France; consequently I send over my actors, as I must do, because I must have the same actors both here and abroad, and I cannot send a part of my company abroad and keep a part of it in this country. I send my company, my producers, and my cameras over to France with negative stock which has already paid the Negative Duty, and I expose that stock in France. Often I have to expose three or four times more than I really require, because when I get it back again I have to edit it and cut out portions which have been taken unnecessarily. I may have taken one scene three or four times, but I only choose one of the scenes, and I destroy the rest. I might bring back some 10,000 feet or 15,000 feet upon which I have already paid£d. per foot, and when I bring it back here I pay 5d. for every foot brought here as duty on a negative film. I have letters in my pocket telling me that the Customs authorities can give me no redress, consequently I have to pay 5d. per foot on 15,000 feet, and when I come to edit it I destroy 10,000 or 12,000 feet and only use the remainder.
§ Mr. NEWBOULDMy second Clause is intended to save something from the wreck. I sincerely hope the Chancellor of the Exchequer will realise that a purely British production and manufacture, because it is exposed under the sun in France and has French scenery in it, should not pay a duty. If he cannot accept it, then it is quite hopeless to expect us to establish or develop the film-producing industry here, because we are paying more duty on 5,000 ft. of film than the foreigner pays on 10,000 ft., and we have to pay on a large amount of film that we do not use. If the right hon. Gentleman insists that the British manufacturer shall pay in this way on a purely British article, it strikes me as being an endeavour to squash an industry to which every encouragement ought to be given.
Mr. CHAMBERLAINLet mo try and make my position clear. The hon. Member has argued the case for both his Clauses, and it is impossible to deal with his speech without taking the two together as one. He speaks as a manufacturer.
§ Mr. NEWBOULDI am not discussing raw stock at all. If it is not made in this country it pays 3d. per foot when it comes in. I am talking about producing and manufacturing the pictures, and not the raw material. My argument has nothing whatever to do with that, and I do not want one. foot of raw stock brought in without paying the ⅓d. duty. I am not at issue with the right hon. Gentleman on that point.
Mr. CHAMBERLAINI was only trying to explain that he and I have been using the term "manufacturer" in a different way. He is not talking as a manufacturer of the film, but as a manufacturer of pictures on a film. The question is, if these films are manufactured abroad, whether they are to be brought in free of duty. I have never heard of any Customs where it was provided that if a citizen of the country which imposed the duty carried on his manufactures elsewhere than in that country his goods should be free from duty, and that is something which finds no place in any Customs tariff in the world. The hon. Member is a British manufacturer in so far as he manufactures within Great Britain, and then he pays no duty on his manufactures; but if he goes abroad to manufacture and then imports what he has manufactured abroad, he pays the same duty as any foreigner who exports from the foreign countries to this country. That, I think, is the only course which it is possible for me to adopt.
Then the hon. Member, to reinforce his case, dealt with the second Clause on the Paper, and he pleads that he imports a certain part of this material for examination, not knowing whether it will be useful or not, and She has to pay duty on it whether it is used or not. That difficulty can be met without any new Clause, for the Customs authority will give the hon. Member an opportunity of examining these films in bond, and if he likes to destroy them there no duty will be paid. On the other hand, if he Lakes them out of bond the will have to pay the duty. We cannot give the hon. Member carte, blanche to take out of our control a dutiable article, and then to tell us hereafter that he has found so much unusable, and we are only to charge him on the balance, which he uses. In that case we should have no control whatever, and his effective grievance will be met if he will use the bonded facilities which are already provided.
Sir J. D. REESIt appears to me that one result of this arrangement will be that the hon. Member will have to abandon his Free Trade principles in respect of the importation of these films from foreign countries. I take it that it is the picture that my hon. Friend wants to get exempted.
§ 8.0 p.m.
Mr. CHAMBERLAINThe hon. Member wants to exempt all pictures coming from abroad. At present, if they are manufactured abroad they pay 5d. per foot duty. If they are blank films manufactured abroad they pay ⅓d. What is not possible is to have one duty for foreigners who send in the article, and another duty for the British manufacturer who makes the article abroad and brings it here.
Sir J. D. REESWhat I venture to suggest is that what is done abroad in the case under discussion is only a subsidiary part of a process which is carried out chiefly in this country. Take the case which the right hon. Gentleman quoted, "A Tale of Two Cities." What is projected on to this film in a foreign country is a subsidiary part of the picture, and the greater part of it projected upon the film in our own country.
Mr. CHAMBERLAINI invite my hon. Friend to read "A Tale of Two Cities" again. If I were to accept my hon. Friend's proposition we might have thousands of feet of film produced abroad and brought in free of duty, simply because a couple of hundred feet are produced in this country.
Sir J. D. REESMay I point out that the competition between America and this country is keen and progressive, and unless care is taken, the British trade is likely to be entirely squeezed out of existence. Therefore my hon. Friend's Amendment is of far greater importance than would appear to be the case when the amount of money concerned is considered. I did hope that the Chancellor of the Exchequer might be induced to look upon this proposal to some extent with a patriotic eye. I would like him to consider that this is a means of advertisement and education which is absolutely unparalleled; it is increasing, and will increase, but there is an intention to corner it and make a trust of it, and to convert it, in fact, into an entirely American enterprise. I am not able, of course, to deal with the technical details of this question like my hon. Friend 482 who moved the Clause, and who is really a master of the subject; but I do understand the broad issues concerned, and I would like the Chancellor of the Exchequer to do what he can to favour a British industry, especially as there is really no great amount of revenue affected. My hon. Friend who moved the Clause found himself in a cleft-stick. He was in the unfortunate position of having to take this action while he was a rigid free trader—action which amounted to inviting the Chancellor of the Exchequer to give a preference in this particular case. I hope the Chancellor of the Exchequer will consider it from the point of view of the desirability of giving a preference to British producers, and will, therefore, accept this new Clause.
§ Mr. JESSONI hope the Chancellor of the Exchequer will give a little consideration to this matter. It is a rather complicated question, because there is no other industry which is in the same position. Let me give two parallel cases to explain that position. An English producer wants to produce a film in which the scenes are set in France or Italy. He sends his English company over to France or Italy where the scenes are, and he takes the pictures there. But the film is being produced all the time by a British company. Yet when it comes to this country it has to pay duty like any foreign manufactured film. But take the other case, that of an American firm which does exactly the same thing. It takes an American company to France or Italy, as the case may be, and there produces its film; it is an entirely American production, and yet it pays no more duty than a film which is produced entirely by a British company under exactly the same circumstances. That is a point I think the Chancellor of the Exchequer should consider. Could he not consistently assist a very struggling but very important British industry It is, I admit, a most difficult problem. But I suggest that it is a really British production although the scenes necessary for the picture may have to be taken abroad. At the present time we are trying to encourage the production of films in this country, but the firms doing this work find themselves at a very great disadvantage in face of a huge American combine, and unless the Chancellor of the Exchequer can see his way to assist this particular struggling British industry, it is going to have a very rought time, and it will be bad for British artists and producers generally.
§ Mr. NEWBOULDI hope the Chancellor of the Exchequer will not accuse me of wasting time, but this is a matter of vital importance, and I would like to point out what his decision means. First of all, he is placing a tax on the sun because it shines in France or Italy. He is placing a tax on the scenery of other countries because it is essential in a picture which we make here. He is inviting the British manufacturer to paint scenery in this country, and we know that the only really effective way of making a film a success is to send abroad to get the natural scenery. I may point out that the expense of the producing firm is largely incurred in this country, and it is merely a case of sending the camera and the raw film and company abroad in order to get the essential scenes to make the picture complete. The right hon. Gentleman has invited me, in regard to my second Clause, to carry out the highly skilled and technical operation of editing a film in bond with the facilities therein provided. I should like the right hon. Gentleman to realise what it means to edit a film. It means, perhaps, six people sitting for hours and hours daily for three weeks, going through sections of the film over and over again; and to suggest that such a highly skilled and highly technical operation should be done in bond is to invite us really to throw up all chance whatever of establishing this very important industry in this country. If, in view of the facts I have laid before him, the Chancellor of the Exchequer adheres to his present decision, I can only go from here and say to the British manufacturers of films that it is of no use attempting to carry on in this country, because they are ladened with a burden which the foreign importer is not called upon to bear.
§ Lieut.-Commander KENWORTHYI have had a good deal of conversation with people interested in the industry, and I have a suggestion to make. May it not be possible for these films to be edited in this country, without any bond restrictions, and allow the cinematograph industry to pay the licence on the finished article, after the films have been cut down? If this plan were abused, then next year we can revert to the suggestion in the present Budget. T suggest that the plan I put forward would get rid of a great deal of the difficulty. The Chancellor of the Exchequer would not lose his tax, and the foreigner would not enjoy a quite unfair advantage over the British producer.
Mr. CHAMBERLAINThe suggestion, I understand, is that duty should not be paid on imported films which are not used. I will see if that can be done, but I must be satisfied in some way or other that, in whatever steps are taken, the revenue shall be sufficiently safeguarded against evasion of duty. So far as the Clause itself is concerned, it does not seem to me that it is confined to protecting merely films produced abroad by British companies. It is rather a protection for any film produced abroad, provided that part of the production of which it constitutes a portion is filmed in this country.
§ Question put, and negatived.