HC Deb 03 July 1928 vol 219 cc1337-40

The entertainments duty imposed by the Finance Act (New Duties) Act, 1916, as amended by any subsequent enactment, shall not, after the first clay of July, nineteen hundred and twenty-eight, be charged on payment for admission to any agricultural show the whole of the profits of which are devoted to agriculture or educational purposes, notwithstanding that admission to the show may include admission to an entertainment subsidiary to the main purpose of the show, in regard to which, but for the provision of this Section, entertainment duty would be payable.—[Mr. Wardlaw-Milne.]

Brought up, and read the First time.


I beg to move, "That the Clause be read a Second time."

I need say little in commending this new Clause to the Committee. The subject has been dealt with on many previous occasions and it makes a special appeal because hon. Members representing agricultural constituencies are to be found in all parties. I have reason to believe that, at last, after a number of years, there is a good chance that the Government will this year feel themselves able to meet us in regard to the proposal in the new Clause. The charging of the Entertainments Duty on admission to agricultural shows has been one of great difficulty throughout the country ever since the Duty was first imposed. It is extremely difficult for the agricultural shows to make progress without some form of entertainment to add to the gate. I have inserted words in the new Clause which I hope have had some effect in influencing the Government to meet us, in order to make it quite clear that any side-shows shall be subsidiary to the main purposes of the show. Therefore there will be no fear of the possibility of an agricultural show consisting of a cow and a plough, and a whole military tournament. The persons who will have the right to see that the subsidiary attraction is not of the same importance as the show itself, are the Commissioners of Customs and Excise. Therefore the Government need have no fear that under this new Clause there is a chance of evasion of the Entertainments Duty under the guise of an agricultural show. These agricultural societies are not working for ordinary profit. There has recently been a test case, under which an agricultural show has been defined as a charity for the purpose of Income Tax, but it is essential that the purpose of the show shall be educational, industrial or for the promotion of children's interests in agricultural pursuits.


Having regard to a recent decision in the Court of Appeal that the Yorkshire Agricultural Society is a charitable body for purposes of Income Tax, in that it benefits the community by promoting the interests of agriculture by means of its annual show and other activities such as educational and scientific work, my right hon. Friend has been advised that this decision must be applied to similar societies for the purposes of Entertainments Duty. The Commissioners of Customs and Excise will therefore be prepared to consider claims made by agricultural, horticultural and live stock breeding societies for relief from Entertainments Duty, not only under the provisions of the law relating to agricultural shows, but also, alternatively, under the provisions of the law relating to entertainments of which the proceeds are devoted to philanthropic or charitable purposes. A leaflet on the subject, is being prepared by the Commissioners and will shortly be ready for distribution to parties interested. An essential condition of exemption on philanthropic or charitable grounds is that the proceeds of the entertainment shall be devoted to the benefit of the community in the improvement of agriculture, horticulture, or live stock breeding. If that condition is fulfilled, there is no restriction on the nature of the exhibits or attractions. In these circumstances I hope the hon. and learned Member will withdraw the Amendment.


There is only one point which is not quite clear. Do I understand that under the conditions which the hon. and gallant Member has laid clown it will be in order, provided the Commissioners of Inland Revenue are satisfied that the attractions are subsidiary to the main purpose of the show, and that the funds derived are devoted in the way he has described, to allow military tournaments provided they are subsidiary to the main purpose of the agricultural show?


The essential point is to what the proceeds are devoted.


What will happen if it is proved by a reference to the balance sheet that the relief in the way of exemption from duty has gone into the pocket of the landlord in the way of increased rent? Hon. Members opposite jeer, but if it is disputed I am prepared to bring forward evidence to show that landlords, and very prosperous landlords, have increased rents to the promoters of these shows when exemption from this duty has been obtained by them. If it can be proved that this has occurred will the hon. and gallant Member reconsider the case?


I do not know that I fully appreciate the point. The important consideration is that the proceeds of the show, after expenses have been met, are devoted to philanthropic or charitable purposes. In that case there is no question of levying the duty.


But before the proceeds of the show can be arrived at the rent of the landlord has to be paid. Will the Treasury take into consideration the amount of the rent in estimating what are the proceeds of the show?


It will not be possible for the Treasury to go into the details of every show. That would involve the consideration of many factors which are included in the expenses, such as the price of the timber for the stands, the cost of erection, and so on, and it will not be possible for the Treasury to analyse all the accounts.

Question, "That the Clause be read a Second time," put, and negatived.

First Schedule (Provisions as to duty and drawback in case of hydrocarbon oils) agreed to.