§ Mr. R. A. Butler
I am considering the general question of the taxation of overseas trading profits in the light of the Royal Commission's recommendations. I cannot anticipate the outcome, but the point which my hon. Friend has in mind will not be overlooked.
§ Mr. Fisher
Will my right hon. Friend bear in mind, when considering this matter, that West Indian Governments give this tax concession to encourage the secondary industries that are so desperately needed out there, but that Her Majesty's Treasury nullifies the whole effect of the incentive value by imposing on firms here the tax on their West Indian profits? Does this really make sense, if we want the West Indies to help to diversify their almost completely agricultural economy?
§ Mr. Butler
I am aware of what is known technically as frustration, which is, in fact, frustration in fact. I am, therefore, re-examining this whole question in the light of the Royal Commission's recommendations.
§ Captain Soames
Is my right hon. Friend aware that, as he has not given this concession, the result is that a lot of dollar capital is flowing into the Caribbean and much sterling capital that would like to go there is prevented from so doing by the Treasury's policy of not allowing some concession to match the concession in the tax policy given by many islands in the Caribbean?
§ Mr. Butler
I am aware of the problem but there is a great deal of difference of opinion about the solution of the difficulty. However, I have given an undertaking that the matter is under urgent consideration.