NEW CLAUSE.—(Further relief from Entertainments Duty for certain philanthropic or charitable entertainments.) (Hansard, 22 June 1925)

§ Mr. GRIFFITHS
I beg to move, "That the Clause be read a Second time."
1213 When I took part in the Debate with a view to abolishing the Entertainments Duty, the Chancellor of the Exchequer pointed out that we were asking for a concession of something like £6,000,000. The concession for which I am asking now is very small. From the reports that I have received from my constituency and elsewhere, the Entertainments Duty is unjustifiable in so far as certain institutions are concerned. I will explain the effect of the tax on halls and institutions erected by miners, steelworkers and other people for educational purposes. In my district, in Blaenavon, there is an institution, connected with which is a library and a large hall for public meetings. The money for the erection of the institution was contributed by the workmen, week by week, and handed over to a committee of workmen who manage the library and hall and the various other departments in the institution. These workmen give their whole time to managing the affairs of the institution. It is a labour of love. Seeing that the hall is sometimes empty for four and five days a week in a small district of that kind, they decided to run what they call a cinema show. They derive profits as a result of the cinema show, and because they exceed the 50 per cent. stipulated in the Clause which is now the law of the land, by paying artistes, they are charged the Entertainments Duty. The management committee utilise all the money, which they do not call profit, for the purpose of giving recreation not only to the miners and steelworkers in the district who own the institution, but to the ratepayers in the town generally.
Out of the surplus money, two or three years ago, they bought a piece of land and made a cricket ground, football ground, bowling green, tennis court and a swimming bath. In doing this they relieve the rates of the town to the extent of about 8d. in the £. Therefore, the ratepayers are relieved on their rates by 8d. in the £ as the result of the money taken at this institution. If the money had been distributed in profits they would be liable to pay tax, but seeing that the money is spent in this way and that it is not profit such as other companies divide amongst themselves, they ought not to be called upon to pay tax. To add insult to injury, the Inland Revenue people compel them to pay In- 1214 come Tax on their profits, so that they not only pay Entertainments Duty but Income Tax. That is no encouragement for these miners and steelworkers, who do this work free of charge and give their time for the benefit and the relief of the ratepayers. Yesterday I met a deputation of these men and they said "You had better go back and tell the Chancellor of the Exchequer that he is giving in a full year £40,000,000 to people who can afford to pay for entertainments, and he is giving in that £40,000,000, more to his friends on that side of the House than the miners earn in wages." The miners' wages in South Wales last year amounted to £30,000,000, and their contention is that if the Chancellor can find £40,000,000 for his friends the rich people on the other side, he can very well give this small concession to these people who are trying to carry on these institutions for educational purposes.

§ Mr. G. HALL
I beg to second the Motion.
The purpose of this Amendment is to exempt from Entertainments Duty those charitable performances conducted by musical and other organisations or associations throughout the country. For some years this question engaged the attention of the House and concessions have been made. First of all, the amount that was allowed for the expenses, before any abatement could be given for the Entertainments Duty on performances for charitable purposes, was fixed at something like 20 per cent. That was increased to 30 per cent. Last year, as a result of the concession that was given by the ex-Chancellor of the Exchequer, it was further increased to 50 per cent. What we ask is that in the case of bona fide charitable performances the limit of 50 per cent. should be abolished, and that if 60 or 75 per cent. of the total proceeds were used for that purpose it should not deter the authorities from exempting the performance from Entertainments Duty.
9.0 P.M.
Every year it is becoming much more difficult to raise money for charitable purposes. Hospitals and all those other institutions are suffering very much. We should do everything we can to encourage those men and women who give their services so freely for purposes of this kind. They feel that it is not right, when they 1215 are organising performances of this character, that they should be charged Entertainments Duty if they do not limit the expenses to 50 per cent. It cannot be argued that this concession will cost very much. Last year the ex-Chancellor of the Exchequer, when pressed as to how much this concession would cost—at a time when the Entertainments Duty was very much higher than it is this year and the allowance was very much lower—said that it would cost something lees than £100,000. I assume that it is now estimated to cost something like from £50,000 to £60,000. That amount cannot make very much difference in a Budget of something like £800,000,000. I am sure that the Government wish to encourage those people who are so anxious to assist a charitable object to go on with their work. If the Chancellor comes to South Wales he will find that in almost every mining town and village we have our musical associations with thousands of members who devote hours and days of their time to working up our oratorios, cantatas and dramatic performances for the purposes of charity. It takes a considerable amount of money to provide the necessary dresses and one thing or another. They feel now, during these very serious and economic times, that unless they can have some encouragement, the work which they have been able to do for the past 10 or 15 years will have to be discontinued. Last year feeling was so very strong on this point that this was one of the very few matters on which the late Government were defeated. They were defeated by something like 50 or 60 votes, and almost all the Chancellor's friends, who are now sitting on the other side of the House, went into the Lobby to support the abolition of this tax upon these charitable performances. Seeing that concessions to very wealthy landowners have been made to the extent of £500,000 a year this year, the Chancellor may be asked to concede this very small amount to show his sympathy with those people, who are prepared to sacrifice their time, and also with their object which is the benefit of charity, which will benefit very largely as a result of this concession.

§ Mr. CHURCHILL
The hon. Member who moved this new Clause dealt in detail with the particular case which came 1216 under his notice, and his account of it was engaging my most sympathetic attention when I was rather rebuffed by the controversial conclusion which he attached to his remarks, which up to then had been of a most persuasive character. There is no doubt that this subject was marked by very great concessions last year, and to some extent these concessions were extorted from the Government last year. I am not myself familiar with the exact Parliamentary episode which occurred, but it is by no means the case that the only concession obtained was an increase in the percentage allowed for expenses from 30 per cent. to 50 per cent. The Finance. Act of 1924, besides raising the proportion of expenses to 50 per cent., in respect of all charitable entertainments, abolished the expenses test altogether in respect of entertainments promoted by societies or institutions of a permanent character established or conducted solely or partly for philanthropic or charitable purposes. This provision authorises the Customs and Excise Department to examine the past records of societies that apply for exemption, so as to enable them to judge whether the entertainment in respect of which exemption is sought is a bona fide effort to raise money for charitable purposes. You have this state of the law accordingly: That every entertainment promoted by a charitable body, such as a hospital for its own funds, is now exempted, however high the proportion of expenses may be. Secondly, every entertainment promoted by other permanent bodies with a bona fide charitable record—I wonder whether that might not meet the case of the Mover of the Clause—is exempted, provided that a reasonable proportion of the takings goes to charity. Finally, any entertainment, by whomsoever promoted, not a permanent body, but a fortuitous gathering of individuals brought together ad hoc, for that purpose alone, is protected from Entertainments Duty, provided that the proceeds are devoted to charity and not more than 50 per cent. of the takings is absorbed in expenses. I do not think that anyone can say that an entertainment which cannot fit itself into any of these very elaborate and very considerate provisions requires special legislative attention by this House at the present time. After all, there are dangers 1217 on the other side. It would be well worth while for the hon. Gentleman who moved this new Clause to examine these provisions very carefully, and to see whether they do not fit the case he has in mind. I would be willing to assist him in that examination.
But there are other classes which, the hon. Member would be the first to agree with me, we do not wish to exempt. We do not wish to encourage the development of a class of so-called charitable entertainments which really would be bogus entertainments, got up by people who would say, "We are giving all the proceeds to charity," and then probably only about 2 per cent. or 5 per cent. is given to charity, while very large payments go to the individuals who are the promoters, and, in fact, they escape the Entertainments Duty under false pretences. That would be very unfair to bonâ fide theatrical companies and entertainment companies, who would be paying the Duty in the ordinary course. We must safeguard the theatrical profession from that