§ Motion made, and Question proposed, "That the Clause stand part of the Bill."
Mr. Vane (Westmorland)
I want to ask the Chancellor why it is intended that the benefits conferred by this Clause in reduction of Entertainments Duty in certain cases where the entertainment is made up of two elements is apparently only to be granted when one of these entertainments is the exhibition of a cinematograph film. I believe that is the intention of the Clause. Surely the right hon. and learned Gentleman knows that there are a large number of anomalies in the incidence of this duty upon entertainments made up of two or more elements. I hope that before the Report stage, he will be able to widen the scope of this Clause so as to obviate some of them.
The hour is too late for me to burden the Committee with details of the anomalies. But, as an example, there are the local agricultural shows which, we all know, can be complicated very easily by the addition of some other attraction, such as a hound trial, even though that attraction takes up only a small part of the total time. Surely entertainments of that sort need support just as much as entertainments of which a part is the showing of a cinematograph film. I ask the right hon. and learned Gentleman to widen the scope of this Clause to meet cases of equal, or even of greater, hardship.
§ Mr. Maudling (Barnet)
Before we finish with this Clause I hope we shall have an explanation from the Government of the purposes which underlie its introduction into the Bill, because I think it is correct to say that it came, as a surprise. The cinematograph industry is still somewhat puzzled to work out the motives which led to its introduction. As I understand it, the Clause does this: there are at present two different rates of Entertainment Duty, a high rate which applies to exhibitions where a film is shown, and a lower rate which applies to live shows. This Clause applies an intermediate rate where there is a mixed show, partly film and partly live.
To the cinematograph industry, this concession really is no concession at all. It is of little benefit to the cinemas, and will be positively harmful to the production side of the industry. The only cinemas which can benefit are those which have facilities, or which can instal facilities, for live shows. From figures which I have been shown, it seems unlikely that many cinemas, whether large or small, will be able economically to instal equipment which will enable them to take advantage of this concession. Therefore, the only cinemas which will benefit will be the cinemas already equipped for live shows and they, broadly speaking, are the larger cinemas. At the present time in the cinema industry the larger houses are doing better than the small ones. Those most in need of a tax concession are the smaller ones, but those are precisely the ones which do not benefit under this Clause.
Let us also consider the producers. There are, as hon. Members know, serious financial difficulties facing our film production, and there is widespread unemployment, especially in my division at Boreham Wood. The effect of this Clause will be to make the position in the production side even more difficult than at present because film producers are having to compete with live entertainment which enjoys a lower rate of tax. They will also have to compete with subsidised live entertainment within the cinemas themselves. This Clause gives the incentive to put on live entertainment in substitution for films and the result of that will be to push out a certain amount of British films—especially "shorts." I 508 know that the Chancellor has a very soft spot in his heart for the "shorts" producer because in 1947 he dilated to the producers and stressed the importance of making sure that sufficient funds became available through the box office to enable the production of good British "short" films. Why, in these circumstances is this Clause introduced, being of little help to the cinema industry, and a decided disadvantage to the production side?
§ Colonel Gomme-Duncan
I support what the hon. Member for Barnet (Mr. Maudling) has said. I see no reason to suppose that this Clause will help the cinema industry in the slightest. I can think of no hall in Scotland where there is a mixed programme of live and film shows; at least, not to any extent. It seems eyewash—if I may use a rather un-Parliamentary expression—to put this in to say, "We are doing something for the cinema industry" and then to add, "But we will cover it with words so that it means practically nothing." The cinema industry is in a dangerous position; we have all, I think, had representations saying how this high entertainment tax is hitting them very hard indeed. I hope that the Chancellor will say in what way it is expected that this will benefit the industry or, in fact, anybody.
§ Sir S. Cripps
This was a request put forward by a section of the cinema industry with regard to a type of entertainment which, I believe, has had considerable success in America, and which has recently started over here. It was thought that this might be a form of attractive entertainment which would allow a good first-feature film to be shown and, instead of a bad American second film, some live entertainment. I believe that such a show has gone on in London for some time. The difficulty of putting on such a performance was made the greater if the live part was taxed at the film rate; that is, that it did not get the advantage it would have had, in the normal way, in the remission of duty.
It was therefore felt to be fair in the case of such mixed entertainment to have a mixed rate which would apply to the whole entertainment. Obviously we could not have two tickets, for that would be quite inconvenient. That is the purpose of the provision. It is not intended to solve the problem of the cinemas; it 509 is only intended to deal with one type of entertainment which, according to representations made to me, was a type of entertainment which was likely to have a greater currency in this country and, therefore, some provision should be made for it.
§ Mr. Carmichael (Glasgow, Bridgeton)
As far as I can gather, there is no claim in respect of this type of entertainment by the exhibitors in Scotland or in England. If the Chancellor feels that some taxation concession should take place, this is the wrong way to go about it. There are few halls in Scotland which could have live entertainment and the cinematograph in the same programme. The halls are so constructed that live entertainment cannot be provided.
I know of no hall in Britain other than the Empire in London where that form of entertainment is provided at present. I am open to be corrected if any hon. Members know of parts of the country where live entertainment is provided with the cinema. I gather that it is an American company which is running the Empire and it is aiding the American and not the British film industry.
Anyone with experience of the entertainment world will admit that in the main it is quite impossible to have live entertainment and a film in the same programme. [Interruption.] The morning is quite young and I do not mind staying here a little longer, and if hon. Members want some advice perhaps I can give it to them. People who go to see a serious film show are unlikely to appreciate the appearance in the hall of a red-nosed comedian, but if that comedian is produced for their entertainment the programme gains a tax remission. That is an amazing approach to the problem of reducing taxation in the entertainment world. The film industry should run the films and leave the live theatre to others.
Perhaps the Chancellor will have another look at this. Is it not unreasonable to introduce a Clause of this kind when this type of entertainment is given only in one theatre in London? If my right hon. and learned Friend proposes to make any approaches in the matter of altering taxation in the entertainment world he should first consult the people concerned. He said that certain interests 510 had already approached him. Can we have more precise information? Have the film exhibitors or producers made representations? The Scottish exhibitors came to London and attended meetings of all the parties from Scotland. They put the case and they have made it perfectly clear to every one of us that this will in no way help the industry with the very serious difficulties it has got. I do ask the Chancellor of the Exchequer or somebody to explain why they should include a Clause of this kind when London is the only place with such entertainment.
§ Sir S. Cripps
This really will not affect Scotland at all if they do not wish to have this type of entertainment. This is a new type of entertainment and it was thought wise, on representations made to me, to make allowance for it. If nobody wants it, then this Clause will never be used.
§ Mr. Pitman
Will the Chancellor answer the question, which is relevant, as to which section of the industry made representations?
§ Sir S. Cripps
It was a joint representation made to me by delegation. I do not want to stir up what possibly may be difficulties within the industry. I was not aware there were any difficulties. I assumed this represented the views pretty well of the industry.
§ Mr. Henderson Stewart (Fife, East)
There is little in this Finance Bill I like, but I think the Chancellor of the Exchequer should be supported in this proposal. I do not agree with the hon. Member for Bridgeton (Mr. Carmichael) about the decided views of Scottish exhibitors. These exhibitors met my colleagues and myself and this Clause was never mentioned. I have seen this joint show in picture houses in different parts of the country and I have thought they were pretty good. Last week in Dublin I saw a first-class dual show of this kind. We know such performance is going on in London. I have seeen it in Scotland but I cannot quite remember where. But I do think this is something that has proved to be good and there is so little which is good in the Finance Bill, that we can compliment the Chancellor. I am glad of this opportunity to say I think this is one of the good parts of the Bill and to wish him luck on it.
§ Mr. Hollis
I am in entire agreement with the hon. Member for Fife, East (Mr. Henderson Stewart). My anxiety is that in our efforts to help the cinema people, we may be overlooking the interests of the live artists. It is clear that this form of entertainment has become popular and that it will greatly be to the advantage of the live artists. Between one thing and another, it seems to be more important than the Bill.
§ Clause ordered to stand part of the Bill.