§ Section seventy-eight of the Finance Act, 1948 (which extends the time in relation to relief from excess profits tax for terminal expenses), shall have effect as if for the words "the end of March, nineteen hundred and fifty-two," there were substituted the words" the end of March, nineteen hundred and fifty-four."—[Sir J. Mellor.]
§ Brought up, and read the First time.
§ Sir John Mellor (Sutton Coldfield)I beg to move, "That the Clause be read a Second time."
The Economic Secretary to the Treasury was good enough to intimate earlier today that it was the intention of the Government to advise the Committee to agree to this new Clause. I wish to express my thanks to the Chancellor for the very careful and helpful attention which he has given to this quite important matter. In the circumstances, I will be as brief as is consistent with courtesy to the Committee, but I must explain shortly what the new Clause would do.
The Clause extends to the end of March, 1954, the period in which terminal expenses qualify for relief from Excess Profits Tax. Terminal expenses are defined in Section 37 of the Finance Act, 1946, and include:
Costs of deferred repairs and renewals…being repairs and renewals which have been deferred by reason of conditions prevailing as a consequence of the war.Terminal expenses also include costs of rehabilitation—for example, the removal of air-raid shelters and the bringing back to their normal places of business enterprises which had to be moved away during the war.I will give one further example. Where physical assets had to be adapted for war purposes, then the cost of readaptation would qualify. The Committee will 2610 appreciate that the difficulty of obtaining building licences has very largely retarded restoration to normal, and in those circumstances I think the proposal for an extension of time is both reasonable and necessary.
§ Mr. J. EdwardsI need only say two things. First I would express to the hon. Baronet the Member for Sutton Coldfield (Sir J. Mellor) our appreciation for bringing this matter forward, and for the very clear exposition he has given of the purpose of the Clause. Second, we do think this is eminently reasonable and trust, therefore, that the Committee will agree to it.
§ Sir Peter Bennett (Birmingham, Edgbaston)In view of that statement made from the Treasury Bench I should like to refer to the new Clause—[Relief from excess profits tax for terminal expenses]—I have down and which is of a similar nature and deals with a similar matter. I am aware that we cannot do two jobs at once, and cannot pass two new Clauses at once, but if I state the reasons for that new Clause, which deals with the same matter—
§ The Temporary ChairmanI am sorry, but it is quite out of order to deal with a new Clause that has not yet been called. If the hon. Gentleman wishes to make comments on this new Clause I shall be glad to listen to him.
§ Sir P. BennettI am only making comments upon this new Clause. We have had this matter before us previously. On previous occasions—on two occasions, at least, as far as I remember—when we put forward the view that the time had come to settle this question of deferred repairs Sir Stafford Cripps said, "Let us go on a little further and see how we get on." We have gone on for further periods, and we still have this problem of deferred repairs in front of us. What we hoped was that the time had come when it would be possible for us to close this matter completely.
The reason why we cannot at the moment complete those deferred repairs is well known—the labour is not available. The result is that year by year there are repairs which are deferred. There are repairs which have been deferred from the period of E.P.T. We should like the Chancellor to look into this question of whether it would be possible to come to some arrangement by 2611 which they could be assessed and the job could be finished off. There are reorganisations which have been pending a long time, and which are being held up until this question is settled.
As the years go by the question arises ever more urgently whether it is in the public interest that certain assets should be repaired or whether it would be better, perhaps, to spend the money on completely new assets, in view of the developments which are taking place. A large number of these cases are in the files of the Inland Revenue as, "Not settled." We feel that the time has come when it would be to the advantage of the Revenue authorities, just as much as to that of our accountants, to come to a settlement, so that the matter need not be brought forward periodically, with the periodic request that the relief should be extended. I hope that the Chancellor will take note of this and look into it.
§ Colonel J. R. H. Hutchison (Glasgow, Scotstoun)What the Economic Secretary has already told us was, in fact, the second string to our bow. We of course must appreciate the fact that he has recognised the very just claims put forward by my hon. Friend the Member for Sutton Coldfield (Sir J. Mellor). However, I do think that E.P.T., finished with many years ago, is something of an anachronism.
I think it is time that the whole thing should be cleared up, that the slate should be wiped clean; and I agree with my hon. Friend that not only the Treasury but those who still have claims outstanding would be benefited if this delaying to which the hon. Gentleman has just given his assent were not carried on any further, for it leaves an unsettled situation in the Treasury and in industry. As my hon. Friend has suggested, I also suggest that he should look into the possibility of estimating the cost of repairs, of wiping the slate clean, and of trying to get this little bit of trouble out of the way for good and all.
I should like finally to ask whether it would not bring some funds into the Treasury—
§ The ChairmanI think that the hon. and gallant Gentleman is not addressing himself to the new Clause before the Committee, but that he is speaking to some other new Clause to which, if I 2612 remember aright, his own name is attached. I must ask him to confine himself to the new Clause before the Committee—a new Clause which, I gather, has been accepted by the Government.
§ 8.15 p.m.
§ Colonel HutchisonI simply say that we thank the hon. Gentleman for what he has done, and ask him to bear that in mind later when we come to our other Clause. In referring to it now we are really saving the time of the Committee, because it will not need any further discussion.
§ Clause read a Second time, and added to the Bill.