HC Deb 15 June 1944 vol 400 cc2229-32

The following Section shall be substituted for Section twenty-five of the Finance Act, 1924: Rule 8 of No. V in Schedule A shall have effect as if at the end of paragraph (2) thereof there were added the words "and shall also include additions or improvements to farmhouses, farm buildings, cottages or land, but only if no increased rent is payable in respect of the additions or improvements and in so far as they are made in order to comply with the provisions of any statute or the regulations or bylaws of a local authority or the directions of any county war agricultural executive committee.—[Mr. Turton.]

Brought up, and read the First time.

Mr. Turton

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

Again, this is repeating the wording of the present Rule 8, with two exceptions. The object of the Clause is to bring Rule 8 up to date, owing to changes in administration of agriculture and the different nature of the improvements of land that are being demanded by Statute or by-law or by directions of the county war agricultural executive committees. The two alterations proposed in the new Clause are the words: include …improvements to …land, which at the present time you cannot get any relief for, and also the words: improvements…made by directions of any county war agricultural executive committees. Let me take the second of those two changes first. It can be said that the Inland Revenue have been as helpful in the past as they could in this direction. Wherever possible, they have tried to argue that a direction by an agricultural committee was similar to a by-law of a local authority, and they have brought it in in that way. I never like to see the Inland Revenue strain the law, whether in favour of or against the taxpayer. The correct thing to do is to put the law clearly in an Act of Parliament so that all taxpayers may know what the law is. If an improvement is ordered by direction of an agricultural committee, which is the modern method of improving agricultural holdings, it is only right that the improvement should be allowed to be included in the maintenance claim. The only reason it is, is that when Rule 8 was invented there were no such things as these agricultural committees. I leave that part of the argument with those words.

Why have I brought in improvements of land? The only improvements I am asking to be allowed for in the maintenance claims are those where no increase of rent is being charged and where the improvements are being made by reason of a Statute or by-law or by direction of an agricultural committee. The type of improvements of which I am thinking are a new drainage system, which is being done everywhere in the country, and the ordering of new roads to connect agricultural land for the purposes of changes in agriculture. There are other improvements in the land being ordered in connection with the Minister's policy of improving agricultural holdings by changing the nature of the agriculture that is carried on. I submit that the proposed new Clause is reasonable and I ask the Government to accept it.

Mr. Assheton

I think my hon. Friend is on a good point this time. The Board of Inland Revenue have been considering this question of county war agricultural executive committees, and they have come to the conclusion that they are justified in treating their directions as coming within Rule 8. They therefore feel that it is unnecessary, in regard to this point, to move the proposed new Clause. On the question of land raised by my hon. Friend, he referred on his previous new Clause to maintenance expenditure spent year by year to keep land in repair. Here he is referring to improvements. Improvements of land fall to be discussed in connection with the changes which my right hon. Friend the Chancellor of the Exchequer is proposing to make later on, when he brings in a Bill in connection with the developing of industry and agriculture. It would be premature to discuss the matter, because the whole of it is under consideration. I am not in a position to say what view my right hon. Friend would take, but the point which my hon. Friend has made will be taken into account. When the time comes, there will be plenty of opportunity for discussing it. I hope the House will agree that it is not necessary to press the the proposed new Clause now.

Mr. Turton

Would my right hon. Friend make something quite clear in the first limb of his reply? I gather that the Board of Inland Revenue agree that the direction should be included, but surely that should be done by Statute, or is it just to be done by a gentlemen's agreement with the Board of Inland Revenue?

Mr. Assheton

They accept the position that it is within the Rule.

Wing-Commander James (Wellingborough)

Arising out of what the Financial Secretary said, that the allowance would be made if work was carried out to comply with the Statute, would it be held that if, in order to produce attested milk, a farmer converted a building, that would be covered by the definition he has just given as for work under a direction by a county war agricultural committee?

Mr. Assheton

I would rather not offer an opinion on that. The answer is not always the same. The hon. and gallant Member had better see in each case what the answer will be, as circumstances vary.

Mr. Colegate

I am very grateful to my right hon. Friend for this concession, but it really would be very much more satisfactory if these words were added in the sense of the Clause. I cannot see there is any difficulty about it. It would be better than relying on these gentlemen's agreements about what is included and what is not. Perhaps at a later stage it could be included.

Mr. Assheton

This is accepted as being the law and in any case my hon. Friend will, I know, appreciate that the Clause he has moved now cannot be accepted for the reasons I gave with regard to the word "land." I think it would be better if the new Clause were withdrawn.

Mr. Snadden (Perth and Kinross, Western)

There is one point on which I am not quite clear. Do I take it that this concession is only to be made where an actual direction has been served? There are cases where, owing to the demands of county committees for extra cultivation, although no direction has been served to provide, say, a house for extra machinery, the person who has to carry out the cultivation, and is bound to carry it out, does not receive a direction to build a house for machinery but to carry out the cultivation. If a producer of food can prove to the Revenue that he has received an order necessitating an extra building to house machinery, for example, will that be considered in the same way as if a direction for the building had been received? I know quite a few cases where some expenditure has been incurred to meet the directions of county committees, and they can get no relief, because the new building is needed to house extra machinery.

Mr. Assheton

I am afraid that the undertaking I have given only covers directions by the country war agricultural committee.

Major York

May I press my right hon. Friend on this point? In the various Income Tax districts there is a great variety of procedure. I think that is commonly known. If we had the words which my hon. Friend suggested there could be no doubt about it, and land owners throughout the country who are members of the C.L.A. organsiation, would get the amendment in their journal, which would give the words, and make the position clear to everyone concerned. If this is left to be included in the Rule by agreement, the people concerned will not know about it.

Mr. Assheton

My hon. and gallant Friend has made a not unreasonable point, and he can rest assured that all Inspectors of Taxes will be informed about it.

Mr. Turton

In view of the assurance which has been given, I beg to ask leave to withdraw the Clause.

Motion and Clause, by leave, withdrawn.