HC Deb 25 April 1933 vol 277 cc53-5

The Committee will expect me to announce the Government's decision upon the taxation of motor vehicles. Whatever views may be held about the calculations and recommendations of the Road-Rail Conference, I do not think there can be any dispute that in the interests of equity between different forms of transport there is an unanswerable case for an increase of the duties upon the heavier class of road vehicles in the goods class. Indeed, such an increase is long overdue, and that was recognised not only by the Road-Rail Conference, but also by the Royal Commission of some three years ago. It is particularly anomalous that the taxation scale should stop at five tons unladen weight when there are many road vehicles which reach 10 tons and even more. I propose, therefore, to impose substantial increases on the heavier goods vehicles as from the 1st January next, and hon. Members will see in the White Paper the details of these proposals.

When they come to examine these details they will find that in a good many respects they vary from the proposals of the Salter Report. It seems to me that in fixing these duties we cannot base them upon any exact mathematical computation of the numerous different factors, which tell in different ways, but which, in one way or another, have to be taken into account. I do not accept the suggestion that £60,000,000 is the normal annual highway expenditure for the next few years, nor do I admit that the Petrol Duty is levied solely or primarily, even on commercial vehicles, as a contribution to road costs. Neither the origin nor the subsequent progress of the tax justify anything of that kind. I estimate the yield from these duties to be £1,750,000 in a full year, and £1,100,000 in 1933. That £1,100,000, of course, does not come direct to the Exchequer, it goes to the Road Fund, but it will accelerate the repayment of advances which have been made by the. Exchequer to the Road Fund in the last few years, and I have taken account of this in my estimate of Miscellaneous receipts.

These various changes, upon which I have dealt with up to now, raised my estimated revenue to £714,777,000
I deduct from that the estimated expenditure of £697,486,000
And I am left with a surplus of current revenue over current expenditure of £17,291,000
without making any allowance for the Sinking Fund. At this point I may say that I am not proposing this year to make any provision for the redemption of Debt. In ordinary times the vast volume of our indebtedness imposes upon us the necessity of redeeming it at a rapid rate, and, of course, in the crisis it was essential to maintain a reasonable Sinking Fund as one of the measures necessary to restore confidence. But confidence has now been restored, and to-day we find ourselves in a position not unlike that with which my right hon. Friend the Member for Hill-head (Sir R. Horne) had to deal in 1922. The country has carried through great Debt operations in the face of immense difficulties, and since 1931, without any marked change in the level of commodity prices, it has brought down the yearly burden of internal Debt from £276,000,000 to £224,000,000. The result of the conversion of the War Loans has been nearly to obliterate the obligatory Sinking Funds; they stand no longer at £32,000,000, but roughly at £7,500,000. I do not think that even the strictest financial purist will quarrel with me for borrowing that small sum to meet my purposes in the present year. In times like these, of unemployment and stress on all sides, and of trade depression, we can, in my opinion, use our money more wisely and more profitably than in the redemption of Debt, provided, of course, that we make generous provision for it when good times come. Therefore, I regard this balance of £17,250,000 as free to be devoted to any purpose which may be suitable.

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