ALLOWANCE FOR ARTIFICIAL SILK USED IN TYRES (CUSTOMS) (Hansard, 22 April 1947)

§ Colonel Crosthwaite-Eyre
I must apologise once again for having confused these two Resolutions. I rise now to put the question which I started to ask on the previous Resolution. It seems to me rather important from the point of view of manufacturers. I ask the Financial Secretary for some explanation of what exactly is the intention of the Government in this Resolution. What difference is it going to make, and what benefits do the Government hope to bring to this country. by its introduction?

§ Mr. Glenvil Hall
As the House will remember, in the Finance Bill last year, consequent on the decision to repeal the duty on artificial silk, it was agreed that an allowance of 6d. per pound should be paid on artificial silk yarns and tissues used in the manufacture of tyres. We have just dealt with the Resolution in which it is proposed that this duty should be repealed, and, that being so, the allowance of 6d. a pound must come to an end, because, obviously, if no duty is paid, no allowance is due. As from the same date on which the duty is repealed, the allowance to manufacturers will come to an end.

§ Mr. C. Williams
We have had a thoroughly practical answer. The right hon. Gentleman has explained that there cannot be an allowance because we are repealing the duty, and I congratulate him on having got so far. That, of course, is practical. But why has this date been chosen? The first of May is a ridiculous date. Why could not this have been done at the proper time? I can see that, as we have passed the previous Resolution, it will be a little difficult to change it now. If we repealed the duty and continued to pay this allowance, the Treasury 922 would be paying out a small sum for two or three weeks, and would probably find it a frightful headache and would further increase the large number of civil servants. I would like to know why this rather Mad Hatter date has been chosen, because it does not seem to have any relationship to 16th April. It seems to be a case of just hanging on to the duty for a couple of weeks for no particular purpose, unless there is some obscure reason—and I am very handicapped in this matter—about this date, and why it should be chosen.

§ Mr. Glenvil Hall
Quite recently, the date has been fixed in consultation and in agreement with the trade. Quite obviously, there was no need for the change to come into operation straight away, as, for example, the Tobacco Duty had to do. Consultations have taken place with the trade, and it has been agreed, in order to make certain adjustments, that 1st May was a convenient date to all concerned. I can assure the hon. Gentleman that, although it might sound like a polling day to him, the date has been fixed as the first day of the following month, which seemed to us quite reasonable, and it has been agreed between the Government and the trade.

§ Mr. Assheton
Before the right hon. Gentleman resumes his seat, would he be good enough to answer the point raised by my hon. and gallant Friend the Member for the New Forest and Christchurch (Colonel Crosthwaite-Eyre)?

§ Mr. Glenvil Hall
I do not know whether the right hon. Member for the City of London (Mr. Assheton) was in the House at the time, but to the best of my belief, I answered the hon. and gallant Member for the New Forest and Christchurch (Colonel Crosthwaite-Eyre).

§ Colonel Crosthwaite-Eyre
I understand that this Resolution deals with Customs, and, therefore, with the imported article. What I asked the right hon. Gentleman was, how did this Resolution benefit the home manufacturers?

§ Mr. Glenvil Hall
I am sorry; I thought that was understood. We are dealing with Excise, and not with Customs.

§ Colonel Crosthwaite-Eyre
It says "Customs."

§ Mr. Glenvil Hall
I know—Customs and Excise. Actually, these are tyres manufactured in this country.

§ Colonel Crosthwaite-Eyre
Where does the word "Excise" appear in this Resolution?

§ Mr. Assheton
If the right hon. Gentleman will refer to the white Order Paper, he will see the word "Customs" in brackets after the words: Allowance for Artificial Silk used in Tyres. That is the point to which my hon. and gallant Friend is directing the right hon. Gentleman's attention.

§ Colonel Crosthwaite-Eyre
The Financial Secretary has made a statement which is of considerable importance to the home manufacturers of tyres. In the heading and in the third line of the Resolution, it says "Customs." In no place in the Resolution does it say "Excise."

§ Mr. Glenvil Hall
It is the Excise Duty which is being repealed. It is true that the word "Customs" appears in the Resolution, but, actually, the allowance made is an allowance in respect of Excise Duty, which is mentioned in the Resolution to which I can no longer refer because we have just agreed to it and passed it.

§ Mr. Assheton
With the permission of the House—

Mr. Deputy-Speaker
The right hon. Gentleman has spoken at least twice.

§ Mr. Assheton
I was going to ask the permission of the House to clear up the point. Is the explanation that a mistake has been made in the copy of the Resolution now before us? If so, perhaps the Government representatives would tell us. I have seldom seen a mistake in anything to do with Customs and Excise. If it is not a mistake, perhaps the Financial Secretary would be good enough to answer the point put to him by my hon. and gallant Friend.

§ Mr. Glenvil Hall
The answer is that we have to cover imports under this head. The allowance will also have to be withdrawn from material imported for the manufacture of tyres, to which this Resolution applies.

§ Mr. Nicholson
Can the right hon. Gentleman make it clear that there is a sharp distinction between Customs and Excise? Surely, it is an Excise and not a Customs Duty? I understand that Customs Duties are paid at the port. Ex- 924 cise Duties are something quite different. Surely, there has been some trip up here?

§ Mr. Rhodes (Ashton-under-Lyne)
Am I to understand that the rayon yarns which we are importing from Italy at about half the price at which Courtaulds can make them have had the Import Duty removed from them?

§ Mr. Orr-Ewing
There is a further complication. While in the immediately preceding Resolution we had the words "Customs and Excise," in this Resolution we are limiting ourselves to the word "Customs." It would seem that instead of carrying out what is perfectly clearly stated to be the intention of His Majesty's Government, we are not, in fact, doing what we all want to do. Can we have some explanation of the matter? It is certainly very complicated.

§ The Solicitor-General
Section 11 of the Finance Act, 1946, provides for this allowance in respect of Customs Duty paid on artificial silk. No allowance is provided to compensate for Excise Duty. All the previous Resolution does is to abolish the Excise Duty by 6d. and to reduce the Customs Duty in the case of yarn and of strip by 6d. Therefore, in order to abolish the allowance, we only have to refer to the abolition of the Customs Duty, because Section 11 never provided for an allowance in the case of Excise. The Resolution is perfectly correct as it stands. Section 11 only deals with an allowance for Customs and not for Excise. We cut out the Excise and proportionately reduce Customs. Therefore, in order to abolish the allowance we refer to the Customs reduction in the Financial Resolution.

§ Colonel Crosthwaite-Eyre
This Resolution penalises the home market because it takes off from Customs a duty which previously obtained.

§ The Solicitor-General
No, it does not. Previously when both Customs and Excise Duties were 6d. more, there was a corresponding allowance of 6d. Now we have cut both down, and all we have done is to take 6d. away. Therefore, they are exactly as they were before the Resolution was made. This is consequential upon the previous Resolution, and the position is exactly as it was before.