NEW CLAUSE.—(Exemptions for registered war charities.) (Hansard, 8 August 1940)

§ Mr. Robertson (Streatham)
I beg to move, "That the Clause be read a Second time."
I move this in spite of the admittedly great need for raising money. Throughout the country there are war comforts organisations knitting for sailors, soldiers and airmen and supplying them with books and games, and great good is being done by communities supplying the troops from their own neighbourhood. Pennies are being collected from humble people who gladly contribute for this good cause, and undoubtedly the troops appreciate these gifts. When our men came back from Dunkirk these organisations played a great part, and throughout the country, at lonely stations where our men are, the receipt of these much-needed woollen articles, books and games does great good. It conveys to the men that they are being thought of by the people at home. I feel that harm will result to the collections for these objects if registered war charities, which are making these gifts gratuitously, are penalised by having to pay this impost.

§ Mr. Levy
Where charities buy goods from traders with the object of making gifts to these charitable institutions, it seems wrong that a tax should be charged, and it would restrict their ability to provide a sufficient amount of goods because they cannot spend more than the sum voluntarily subscribed. It seems a pity that the Services should be deprived of the extra comforts which would be acquired with the money so subscribed if tax had to be paid on the goods purchased. Since it is here a question of bona fide charities, which do not re-sell the goods which they purchase, but make an absolute gift of them to the Services, I hope the Chancellor will agree to this new Clause.

§ Sir H. Williams
I wish to support the new Clause. On this matter I am subjected to a certain amount of domestic pressure, since my wife happens to be the vice-chairman of the Frances Day Fund for providing games for the troops. If this new Clause is not accepted, the effective work of this charity—which is not yet a registered war charity, for reasons which I will explain in a moment —will be cut down by one-quarter. If 573 the new Clause is not accepted, the money contributed to that charity will go only 75 per cent, of the distance which it now goes. The charity gives playing cards, dartboards, and so on, to the troops. I believe it has supplied every prison camp in Germany where our men are with a certain amount of amusement to relieve the tedium of their lives. It is incredible that the Committee should solemnly impose a tax which would take away 25 per cent, of the contributions which people make to a charity of this kind.
I have said that it is not a registered war charity. There are, indeed, no registered war charities, because the Government Department concerned with this matter since the Act was passed has not yet printed the forms to enable people to make applications. I hope the Chancellor and the Financial Secretary, who have to supervise all Government Departments, will tell them to get on with this matter, so that charities can be registered, with the consequent elimination of the risk of there being war charities which are not properly run. It seems to me that it would be a very harsh thing to say-to even- person who gives £1 to one of these war charities, which are run almost entirely by voluntary workers and the overhead expenses of which are small, that 25 per cent, will be taken away in taxation, and to that extent the effectiveness of the work of these charities be diminished. When the men are stationed in isolated places, facilities for recreation among themselves contribute very much to their morale. It is difficult to interpret the Schedule. Some people may be knitting comforts and buying fabrics the price of which will be raised by this tax. I beg the Chancellor to give some consideration to this new Clause, because he will affront public sentiment if he taxes the money which people contribute for the purpose of bringing comforts and cheerfulness to those serving in the Forces.

§ Captain Crookshank
I am afraid that, in spite of the eloquent appeals which we have heard, we must consider this new Clause as one more attempt to get us on to the slippery slope. My right hon. Friend does not feel that he can accept the new Clause. The hon. Member for 574 Streatham (Mr. Robertson) said that throughout the country there are small charities which provide comforts for the troops. My experience of most of these charities is that what they collect and send out to the troops are mostly, although, of course, not entirely, either "smokes" or woollen goods which have been knitted at sewing parties.
To the extent that that is the chief way in which they spend the money connected for the assistance of the troops neither of these categories comes within the tax. Tobacco is exempted and, of course, wool, which the women use to make socks, scarves, mufflers and the rest of it. With regard to the other comforts, I would say that probably the great bulk of the charities which buy these things, in fact buy them from retail shops.

§ Sir H. Williams
No.

§ Captain Crookshank
The hon. Gentleman always has the most up-to-date statistics but I was following the hon. Member for Streatham who spoke about small charities throughout the country and taking my own constituency as an example, I do not retract the statement that they buy these things in retail shops. We go back to the principle of the tax which I have discussed earlier. The tax arises at the moment when the goods pass from the wholesaler to the retailer and it would be impossible, under any kind of administration, in the case of a tax of this nature, to make an exemption when the article is eventually sold by the retailer. At that stage it is impossible to "unscramble" the tax. The hon. Member will agree that the great bulk of these most deserving charities, to which I hope all hon. Members subscribe and will continue to subscribe, deal with goods not within the scope of the Purchase Tax. I think it will be realised that my right hon. Friend is not, therefore, so harsh as might appear.

§ Sir H. Williams
I really must protest. My right hon. and gallant Friend's speech had not the faintest relevance to the new Clause, which says: The provisions of this part of this Act shall not apply to chargeable goods brought under chargeable purchases by any registered war charity. He first tells us that the tax does not 575 apply to "smokes" and does not apply to wool. That has nothing to do with the argument. What is relevant is what is in the Bill, and what is not in the Bill is not relevant. He says that a lot of these things are bought from the retailer; but this new Clause does not apply to that. It applies only to chargeable goods bought under chargeable purchases by any registered war charity. That is to say, when the goods are bought wholesale by a registered war charity. Therefore, the whole of my right hon. and gallant Friend's speech had no relevance of any kind to the new Clause. It is when a war charity goes direct to a manufacturer or wholesaler. Whether the retailer subsequently sells them or gives them away, has nothing to do with him. Therefore, there is not one word in the brief on which my right hon. and gallant Friend based his speech—composed by the most intelligent people who have to advise the Chancellor of the Exchequer and the Financial Secretary to the Treasury—which has the faintest relevance to the proposed new Clause which we are now discussing. I beg the right hon. Gentleman and the Financial Secretary to reconsider the matter, because they have opposed the Clause for reasons which have nothing to do with the words in the Clause.

§ Captain Crookshank
I was really answering the speech made on the new Clause by the hon. Member for Streatham.

§ Sir H. Williams
I think the duty of a Minister is not to answer speeches but to 576 answer the proposals placed before the House of Commons. Because my hon. Friend the Member for Streatham made a speech which, with all due respect to him, I assumed was not too much in order on the Clause, that it is not the slightest reason for a Minister of the Crown or the right hon. and gallant Gentleman to make a speech which was prepared beforehand. We all know how Budget Debates in the old days were conducted. There was plenty of paper then and they used to print the speeches but now they type them. I ask the right hon. Gentleman to reconsider this matter, because it is not good enough to refuse a new Clause for reasons which have not the faintest relation to the proposal.