HC Deb 09 April 1957 vol 568 cc993-4

I am proposing to make one other change in indirect taxation. When the additional duty of Is. a gallon was imposed on petrol and certain other light oils last December, it was made clear that the extra duty was temporary. In fact, the Act lays down that it is to be removed not later than one month after the end of rationing of all the products liable to the duty.

But we do not want to continue it any longer than we must. Although our oil supplies are not yet back to normal, they have improved sufficiently to justify the removal of the additional duty. I have, therefore, approved the issue of a Treasury Order, under which the duty will be restored to the former rate of 2s. 6d. a gallon for light oil and derv delivered from the refinery or bonded storage from 6 p.m. this evening.

I am in some difficulty in giving the Committee an estimate of the cost of this proposal. In the immediate future there will be a definite loss of revenue. On the other hand, as soon as rationing comes to an end—and we do not know when that will be—the yield of the duty will increase. It is impossible, therefore, to calculate the cost of the reduction of duty, but the least figure I can put on it is £10 million.