Clause 31.—(POWER TO MAKE REGULATIONS.) (Hansard, 27 June 1957)

§ Sir P. Spens
I beg to move, in page 25, to leave out lines 43 and 44.
The Clause gives the Commissioners of Inland Revenue powers by Statutory Instrument to make regulations to deal with this part of the Bill. The second power which is given to them is the power to extend the time within which assessments may be made. I am moving the Amendment because, whatever other powers the Commissioners have, the time for making assessments ought to remain the ordinary statutory time. It is true that the Government have put down an Amendment which will enable them to do it only with the consent of the House of Commons, but all the same on previous occasions we have resisted the power of the Board of Inland Revenue to extend the time for assessments. I strongly take the view that if the statutory period is not sufficient, then the fault is that of the Commissioners and nobody else.

§ Mr. Mitchison
I hope that the Government will not be so weak-kneed as to accept the Amendment. We have already passed a Clause, quite unprecedented, giving the same Commissioners the power to remit mistakes which did not result in any great benefit for the company. After that quite remarkable innovation in the law of Income Tax, that little reversion in financial matters to the Statutes of Henry VIII, it is remarkable for the right hon. and learned Gentlemen of the Tory Party to boggle at a little thing like this.
The right hon. and learned Gentleman used language which implied that a positive Resolution would be required, but the following Amendment is in the opposite sense, and it gives the House 565 an opportunity of praying against one of these orders if it thinks it unreasonable. While I view with certain suspicion the grant of unfettered discretion, even upon a comparatively small scale, to the Commissioners—which is what we had a short time ago—this kind of thing leaves me much less bothered, and I can see no particular reason why the Commissioners have not had this power. One never knows what the Government will accept nowadays, but I suppose that it is a fair inference from the next Amendment that they will not accept this one, so perhaps I need not say more.

§ Mr. Powell
I find that my right hon. and learned Friend's arguments have made more impression upon me than they evidently have upon the hon. and learned Member for Kettering (Mr. Mitchison). It is quite true, as my right hon. and learned Friend said, that the period within which assessments can be made—fixed by Statute—is a very important safeguard of the subject. The idea behind the paragraph which the Amendment seeks to delete was that cases can arise—as has been mentioned earlier—where an overseas trade corporation, in a particular year, might claim to have put itself out of court as an overseas trade corporation where that was an advantage to it, and that claim might well disclose the fact that throughout the whole of the period in which it had been treated as an overseas trade corporation—which might have been for more than six years—it had been enjoying that status without any right to it.
I hope that the provisions which my right hon. Friend proposes to introduce to prevent overseas trade corporations from disqualifying themselves at will in order to gain a tax advantage, however, will be sufficient to meet the point in mind, and I therefore recommend the Committee to accept the view that paragraph (b) is unnecessary and should fall away.

§ Mr. Powell
I beg to move, in page 26, line 11, at the end to add: (3) A statutory instrument containing regulations made under this section shall be subject to annulment in pursuance of a resolution of the House of Commons. The matters which, by subsection (1), the Commissioners are to be given the power to regulate by Statutory Instru 566 ment, will certainly include matters which ought not to be settled by them without the power of the House to negative them. The Amendment therefore makes Regulations made under subsection (1) subject to negative Resolution in the House.

§ Mr. Mitchison
The wisdom of what the Government have done by accepting the first of the two Amendments to the Clause will depend entirely upon the efficacy of the Amendments they propose to make, which will be to the effect of preventing people using the qualifications in the Clause to come in and out of the status of overseas trade corporations—for those were the Amendments to which the Financial Secretary referred. Those Amendments, as he told us earlier, will give the Commissioners power to investigate the intentions of the companies concerned, which means, in fact, the intentions of the directors of those companies. It seems to me a very remarkable view of the value of individual liberty to object to a time of assessment—as was the objection in this case—and, at the same time, to accept the principle and the practice that the Commissioners are going to inquire into intentions in a matter of this sort. I should have thought that it was not advisable to have it depend entirely on matters of intention, and that to omit what has been omitted today simply on the strength of that will prove a serious mistake.
As with so much of this part of the Bill, we get the same thing. Late at night the Government themselves drill an even larger hole than already exists in the sieve which the scheme contemplates. It happens regularly every night. If we went on for a few nights more, it would simply mean that there would be a few more holes in the sieve. The Government then cheerfully say "It will come out all right in the end." I dare say it will, but for whom? Whether it will be for the Revenue or for some of the Government's friends in the City of London, I do not know.