§ Fifth Resolution read a Second time.
§ Motion made, and Question proposed, "That this House doth agree with the Committee in the said Resolution."
§ 3.51 p.m.
§ Mr. Pethick-Lawrence (Edinburgh, East)
We on these benches have not opposed the preceding four Resolutions and we do not propose to oppose the Fifth or Sixth Resolutions relating to tobacco. We have taken this course in spite of the fact that we appreciate that these taxes will press very heavily on a number of working people who will be in a very strained condition with regard to their expenditure. I rise, however, to put to the Chancellor of the Exchequer two points with regard to this tobacco tax. The first point is a general one. I desire to ask the Chancellor what steps he is taking to ensure that customers who purchase tobacco in the retail shops are not mulcted, on account of the tax, of a larger amount than the tax which is collected by the Revenue authorities. I have not weighed the packets of the different brands of cigarettes, but there are people who think that the additions made to the prices of cigarettes are more than is adequately represented by the tax which is imposed by weight, and I would like to know from the Chancellor of the Exchequer, before we part with these Resolutions, what steps are taken to secure that that is not the case.
744 The other matter which I wish to raise on these tobacco duties is one that was put forward by my hon. and gallant Friend the Member for Central Wands worth (Colonel Nathan) with regard to the supply of cigarettes to members of His Majesty's Forces inside this country. There is considerable feeling in this matter in all parts of the House. I fully realise that it would be quite wrong for the Chancellor to make any concession which would lead to any real leakage of revenue. If, for instance, he were to propose that inside this country the price of cigarettes where soldiers are in the habit of dealing were to be at a lower level than that which prevailed in the outside market, then of course it would be possible for all sorts of friends and temporary friends of soldiers to get their tobacco cheap in that way, and that would be quite an impossible state of affairs. I also realise that one of the objects of the Chancellor of the Exchequer in this legislation is probably to keep down the actual amount of smoking in this country with a view to preserving foreign exchange. But what I think hon. Members are anxious to know, bearing in mind those two main considerations, is, whether the Chancellor of the Exchequer has given any serious thought to this matter. Of course, it is not for me to suggest ways in which the administrative difficulties might be overcome, possibly by allowing quite small purchases to soldiers or by allowing them to purchase at special canteens, or whatever steps might be taken with regard to purchases of a limited amount. I quite appreciate that there are considerable difficulties, but whether they are insurmountable or not I do not feel confident to judge.
I should like to ask the Chancellor of the Exchequer whether he has already given consideration to this point, and if he has not done so whether he will do so between now and the Second Reading of the Finance Bill. If he finds himself able to make some concession, even if it is quite a small one, I feel sure that it will be received with approval not only on these benches but in all parts of the House. After all, the soldier who is staying in this country and has not gone overseas has a great many disabilities compared with the man serving abroad, and although I recognise the considerable difficulties I think that his peculiar 745 position needs special consideration. The Chancellor has already put up the price of one of the few luxuries enjoyed by such a man, namely, receiving and writing letters, and if at the same time he has to pay more for his cigarettes, his very few diversions from the ordinary routine life will be still further reduced. I hope, therefore, that we shall have a sympathetic if at present not a final concession by the Chancellor of the Exchequer on this point.
§ 3.57 p.m.
§ Mr. W. H. Green (Deptford)
I am sure that no one in this House desires to make any harder the lot of the average private soldier. I am not sure that some hon. Members at least are fully seized of the hardship and grievance which the private soldier feels over this tobacco tax, particularly those on active service at home and more particularly those engaged in the anti-aircraft service, who have an extraordinarily monotonous time. To them tobacco, not only cigarettes but pipe tobacco, is a real necessity. If I may mention a personal incident to enforce this view in order that the Chancellor may perhaps give it attention which he might not otherwise do, I have a son serving at home in an anti-aircraft unit. When the Budget was announced he said to me: "Dad, my colleagues here are very upset about this tobacco business. I am sure that if the Government only knew the circumstances which surround these private soldiers they would think twice before they imposed this duty. What is actually happening here is this: On Wednesday night the average soldier has to finish his smoking"—that was before the tax came into operation—"Heaven only knows what will happen when this tax comes on. Further, we see private soldiers lighting cigarettes and, knowing that the number is severely limited, putting them out half smoked in the hope of having the other half at some later time."
I suggest that this is not the occasion to extend these grievances. I know the difficulties with which the Chancellor will be faced if he sets about endeavouring to remove from the serving soldier in this country this impost, but surely it is not beyond the realms of ingenuity to devise some means by which an average allowance of tobacco and cigarettes to a serving soldier at home might be served, if not 746 duty free at least free of this extra impost which the Budget envisages. I urge the Chancellor, for the sake of our soldiers—and it ought not to be an appeal which needed emphasis to have effect—to consider whether there is not some means by which thousands of these men with extremely limited incomes might be exempt from this extra impost.
§ 4.0 p.m.
§ Mr. Graham White (Birkenhead, East)
I think this is probably the only point in connection with these duties which the House would wish to consider. There is no doubt, from the correspondence which we have all received, that this is a matter which has aroused a certain amount of disappointment among a very large number of the serving troops. I received a long letter only this morning suggesting a piece of machinery for giving effect to some concession. The suggestion was—I have no knowledge which would enable me to determine whether or not it would be effective machinery—that the tobacco might be sold to the N.A.A.F.I. canteens throughout the country at a price which would not include the additional impost. I put forward that suggestion to the Chancellor of the Exchequer for what it may be worth.
§ 4.2 p.m.
§ Mr. Burke (Burnley)
I also have had a number of letters from people in distant parts of the country serving on home defence—old soldiers used to smoking and having a good deal of time on their hands, but whose duties are very monotonous and dreary. They complain that while they are as far from their homes as many of the men on the North Western Front or in France, they do not have anything like the facilities which those men have; for instance, they do not get concerts and all those little amenities that are being given to the men in France, and yet their duties are highly important, as this House knows very well. They are at danger spots in the country, and in particular I have in mind a place which has been raided over and over again, away up in the North. The men in France, while under no more danger and living a comparatively easier life, have the facility of sending home letters without any postage, but the men for whom I am speaking will now have to write home at an increased charge and will not have the chance of getting free 747 cigarettes. I would like the Chancellor of the Exchequer to consider whether it would not be possible, in Army canteens, to allow these men to get a rationed quantity of cigarettes per week at reduced prices, so as to make their conditions something comparable to those of the rest of His Majesty's Forces who are overseas, for these men are doing just as arduous and necessary a job on our own shores.
§ 4.4 p.m.
§ Sir J. Simon
The right hon. Gentleman who first raised this point to-day asked me whether I had already maturely considered it. I certainly have considered it. I have a great deal of sympathy with the difficulty which I appreciate is felt; and I think nearly every Member of this House has had his attention called to it by correspondence. I am fully alive to it, but it is a very difficult thing indeed to arrange for. It is really, of course, of the nature of a Customs and Excise Duty that it should be represented in the price of the article here at home. After the duty has been paid and the article is exported, the fact that it passes out of the country gives the opportunity for giving any necessary rebate, and we do give it. Consequently, it follows that there is no difficulty really in securing for those who are serving in France that they do not bear the duty. Hon. Members will appreciate that, but that difference does not arise from the fact that we conceive of those who are serving in France as though they were necessarily rendering a different or superior service to those who are serving all over the country at home, as the hon. Gentleman opposite has said. It is not that at all; it is the difficulty of arrangement.
We have tried to meet the point in the more limited cases which I will mention to the House, because I would not like anyone to suppose that we are indifferent to this matter. If you take, for instance, supplies of tobacco for those who are wounded in hospital—soldiers who have been wounded and are lying in hospital—I think it has really been done outside the strict terms of the Statute, but in fact I am, through the Vote of Credit, seeing that tobacco is provided for those people who are being looked after, wounded in hospital, without the duty being paid. 748 That, of course, is a very limited class. They cannot set up a trade in cigarettes, and there may be some limit to the amount of their smoking, for medical or other reasons, but that is a case where we could do it, and we did it very gladly, as I am sure everybody all over the House would wish. In the same way, there are cases where gifts of tobacco are sent from overseas into this country. There is a number of approved organisations, including the British Red Cross Society and, I think, the Navy League, which are allowed to receive free of duty imported gifts of tobacco for distribution to the wounded in accredited hospitals. There again, as the House will see, the machinery is possible, because, of course, as the package comes through the Customs it is possible to make certain that it is really addressed to the Red Cross or whoever it may be, and that it has not been opened or distributed or otherwise dealt with on the way.
In a limited case like that we can do it, and where we can, we ought to do it; but this is a very different case. It is an extremely difficult case to conceive a solution for. The classes affected are really very wide. Probably many of us think of the particular class brought to our attention, like the hon. Gentleman who has spoken, but you would have to include a very great variety of services all more or less connected with the war—men and women in all sorts of services. I must say that I share the view which was expressed, I think, at this Box yesterday by the Secretary of State for War, to whom a question on this subject was addressed. He pointed out—and I do not see the answer to it—that if you really were to say that in the canteens cigarettes were to be sold across the counter at less than the normal price—less the tax or less the latest addition to the tax—really you would have no practical means of securing that the sale was just a limited sale for the individual smoker; and nothing would be easier than to start a traffic in such cigarettes, to the advantage of both the person buying them and the person to whom they are sold. I do not think it would be a very heinous crime, because generally a soldier is friendly with plenty of people in the neighbourhood, and it is asking a good deal of him to assume that he will take so strict a view of the needs of the Chancellor of the Exchequer that 749 he will never yield to that very obvious opportunity.
I think the Secretary of State for War was right when he said that you cannot get over that difficulty. No doubt it could be got over—I admit it—if the canteens themselves were prepared to purchase the cigarettes in the ordinary way, wholesale, of course, and then to retail them over the counter at a lower price. That is certainly possible. That does not touch the revenue at all, and it satisfies all the necessary conditions about Customs and Excise. I can imagine that there might be difficulties in that solution, though I daresay hon. Members would like to have it further investigated. I do not oppose it at all, but it is a little hard, I would have thought, on those who do not happen to be smokers if the profits, if there are profits, of the canteen are thus to be used for the purpose of subsidising those who wish to buy cigarettes. You might say, "We will do the same thing about beer and spirits. "It seems to me, however, that we are really face to face with a practical difficulty. I have taken the House entirely into my confidence. I have no sort of wish to make things more difficult for the serving man, whether here or anywhere else, but looking at it, as I am bound to look at it, first from the revenue point of view and secondly from the practicable point of view, we have not struck a method of solution which will get over those difficulties.
I am perfectly prepared to say that I will communicate further with the Secretary of State for War, and I need not say that any good suggestion which may be made in the Debate or which occurs to anybody shall be studied with every desire to be helpful, but I am bound to give the answer that so far as I see at present I really do not see how these difficulties can in fact be got over. While it is true, of course, that there are many restrictions which the serving soldier, or sailor, or airman is under, we have to remember that ordinary citizens too, some of them with very small incomes, who are not provided out of public funds with shelter and food, have, out of their own pockets, to bear this additional tobacco tax. I realise that it is indeed a very considerable hardship to a great many people, and I wish I could find some way of avoiding inflicting these burdens, but I cannot, and, that being 750 so, I am bound to give what I am afraid is this rather discouraging answer to the House.
The right hon. Gentleman asked a second question—he put it first—and it is a question that is very familiar when a rate of duty is changed, namely, how far one can be sure that ordinary customers are protected against being mulcted of a greater addition to the price of the cigarettes which they are buying than the increase in the duty would warrant. For the most part I think these things are sold under a brand, and it is not a case of a particular shop pricing them. They are mostly sold under a brand, although there is a certain amount of competition between different brands. It is not true to say at the moment that the Prices of Goods Act has actually been applied to the subject of cigarettes and tobacco, but it could be, and I agree that it is very important that we should do what we can to secure that there is not an improper addition made to the price.
§ Mr. Shinwell (Seaham)
Is the right hon. Gentleman not aware that that kind of profiteering is already going on in this House?
§ Sir J. Simon
Not, I presume, in the House, but possibly in the precincts. That would be a question more properly addressed to the Kitchen Committee. Anyhow, I think that all that one can say is that we always keep our eyes open to this sort of thing, and in the case of the tobacco trade, which has always been a trade which has been responsive to the appeals made to it by the authorities, I should be very much surprised if there were illegitimate profiteering in this regard. If it turns out that there is any, I shall be quite prepared to communicate with the trade on the question.
Question, "That this House doth agree with the Committee in the said Resolution," put, and agreed to.
Sixth to Eleventh Resolutions agreed to.