HC Deb 07 July 1959 vol 608 cc1130-62

(1) Subject to the provisions of this section, where the entertainments duty chargeable in respect of the entertainments given by any person at any place in the week beginning with the second day of August, nineteen hundred and fifty-nine, or any subsequent week exceeds twenty pounds, he shall be entitled to deduct that amount from the duty which he would otherwise be required to pay over to the Commissioners of Customs and Excise, and where that duty does not exceed twenty pounds he shall not be required to pay over to them any duty in respect of the entertainments given by him in that place in that week. (2) Where in any such week as aforesaid two or more persons give chargeable entertainments at the same place, the foregoing subsection shall have effect in relation to each of them with the substitution for twenty pounds of an amount which bears to twenty pounds the same proportion as the number of days or parts of a day in that week on which he gives a chargeable entertainment in that place bears to the aggregate of the numbers of days or parts of days in that week on which both or all of them give chargeable entertainments there. (3) Expressions used in this section and in the Entertainments Duty Act, 1958, have the same meaning in this section as in that Act, except that "chargeable entertainment" does not include an entertainment where, by reason of any exemption or the amount of the payments for admission, no duty is chargeable. —[Mr. Amory.]

Brought up, and read the First time.

The Chancellor of the Exchequer (Mr. Derick Heathcoat Amory)

I beg to move, That the Clause be read a Second time.

This new Clause embodies the principles of a new Clause tabled by my right hon. Friend the Member for Blackpool, North (Sir T. Low) during our discussions in Committee. I had to resist that new Clause because it had certain technical defects, and for that reason only. The effect of this new Clause is to reduce by £20 each week the Entertainments Duty payable in respect of admissions to each place of entertainment. There is a provision for the apportionment of the relief when a cinema is used by two or more proprietors. I am informed that this is done in certain cases. There are some small cinemas, for instance, where the afternoon show is given by one proprietor and the evening show is given by another. I cannot tell the House how frequently this happens.

The new Clause gives relief to the cinema industry in a way which, in my view, gives most help to those who need it most.

Mr. Mitchison

On a point of order, Mr. Deputy-Speaker. Should we be in order, on this new Clause, in referring to the new Clause (Reduction of scope of entertainments duty, which deals with a similar subject?

Mr. Deputy-Speaker

Mr. Speaker has not selected that Clause.

Mr. Mitchison

Further to that point of order. Without it being selected, may we refer to it?

Mr. Deputy-Speaker

No. It will not be called.

Mr. Swingler

Further to that point of order, Mr. Deputy-Speaker. The point of the new Clause (Reduction of scope of entertainments duty) was not discussed in Committee. Although I appreciate that we cannot challenge Mr. Speaker's decision in not selecting that new Clause for discussion, I take it that we are permitted to discuss the subject, that is, methods of reducing Entertainments Duty alternative to the one now proposed by the Chancellor.

Mr. Deputy-Speaker

Certainly. That is the idea of the debate. If hon. Members dislike this new Clause, because it does not do this or that, and they prefer something else, they will not give it a Second Reading.

Mr. John Rankin (Glasgow, Govan)

Further to that point of order, Mr. Deputy-Speaker. I am sorry to press the point, but I did not quite catch your concluding sentence. The new Clause (Reduction of scope of entertainments duty), which stands in my name and the names of two of my hon. Friends, is one which has not been discussed at any stage, although I did refer on a previous occasion to the 2s. tax-free allowance. It has not been selected, but may we take it, nevertheless, that we are not prevented from using the argument it contains in dealing with the Chancellor's new Clause?

Mr. Deputy-Speaker

That is the point of the debate. This new Clause may be negatived on Second Reading because it does not include this, that, or the other thing which hon. Members want.

Mr. Amory

I was saying that the proposed new Clause gives relief in a way which, I think, will be of most assistance to those cinemas which are in need. As I said in Committee, I am particularly concerned about the position of small country cinemas and cinemas serving small market towns which have only one cinema. I know that many such cinemas are having great difficulty in staying open, and, if they are forced to close, the result may be to leave their audiences without any alternative cinema within reasonably easy travelling distance. The Clause will, of course, help all cinemas, but, proportionately, its benefit will be greater for the smaller cinemas and less for the larger cinemas in the big towns.

In this respect, it seems to do better than the alternative ways of giving relief which have been suggested, such as, for instance, the method suggested in the new Clause (Reduction of scope of entertainments duty) standing in the name of the hon. Member for Glasgow, Govan (Mr. Rankin) and his hon. Friends. To start with, the hon. Gentleman's method would be more costly to the Exchequer than what I now propose. To increase the exemption limit to 2s. 6d. would cost £5¼ million. That may commend it to the hon. Gentleman—

Mr. Rankin

But not to the Chancellor.

Mr. Amory

Even the modest increase of the limit to 2s. would cost £3¼ million, which is still slightly more than the cost of my proposal.

What is more important, I think, is that the greatest benefit of a concession on the lines suggested by hon. Members opposite would go to those who need it least. The relief would be based on the number of admissions and would, therefore, be greatest for the large cinema drawing a capacity audience, the one which is most prosperous, I should have thought, and least for the cinema having the smaller audience and, therefore, one would suppose, being in greatest difficulty.

At the same time, most of the small cinemas, would still have to pay some duty on admissions to the dearer seats, whereas the new Clause I am proposing will relieve a large number of small cinemas from tax altogether. I think that about 1,500 cinemas usually pay less than £20 in duty each week, and practically all these will, under my new Clause, pay no duty at all.

In Committee, the hon. Member for Walthamstow, West (Mr. Redhead) objected to the principle embodied in this new Clause because, in his view, it was an undesirable precedent that cinema exhibitors should be told to collect duty from the public and then be allowed to keep for themselves up to £20 of what they collect. If we examine it and think about it a little more, we shall see that there is not a great deal in that argument.

This proposal will have the same effect on the cash position of a cinema proprietor as a straightforward reduction in duty. It will be just as easy for him, if he wishes, to pass on the benefit of this concession to the public. The arithmetical computation presents no difficulty. I have no reason to suppose that in existing circumstances; when many of them are hard pressed financially, cinema proprietors propose to pass on to the public the benefit of this or any other concession that might be proposed on this occasion. The benefit which the public will derive will be that a number of cinemas which otherwise might have had to close will now, thanks to this relief, be able to stay open.

There is, at the same time, one reason why this concession is of more benefit to cinema proprietors than a straightforward reduction in duty would have been. That is the effect on the film levy. As the House may be aware, the limit for exemption from this levy is based on net takings—that is, on gross takings, less Entertainments Duty. A reduction in duty automatically increases net takings and would, therefore, make a number of cinemas now exempt subject to the levy. The Clause, as it is drafted, does not have that effect. It does not alter the amount of duty chargeable, but does alter the amount to be paid over to the Customs and Excise. In consequence of that, no cinema previously exempt from the levy will have to pay it as a result of the Clause.

I will not say anything now about the Amendment dealing with the date at which this new Clause will take effect. I shall be glad to say something about that when the Amendment is called. For the reasons I have mentioned, I do not think that we could find a way in which we could distribute this sort of sum which would be more greatly to the benefit of the type of cinema that we are all most anxious to help. I therefore recommend the Clause as it is drafted for the favourable approval of the House.

Mrs. White

As the right hon. Gentleman knows, our main quarrel with the Clause is not so much the method, but the amount involved. As we have said at earlier stages in our discussions, we think that the result of this proposal is inadequate for the needs of the cinema industry at present. We on this side of the House believe that the time has come when Entertainments Duty should be abolished altogether. This is not the place or time to discuss that again in detail, but I think that we should make our position perfectly clear.

The new Clause which has not been selected, but to which reference has already been made, would go some little way towards meeting our position. As the Chancellor has said, if the exemption limit were raised to 2s. 6d. the reduction would be a little over £5 million, which would be roughly double what he is proposing in the Clause. That would doubtless be an improvement, although I repeat that we think that the time has come when this discriminatory tax should be abolished.

4.15 p.m.

Having said that, I wish to make further reference to the method chosen by the Chancellor. The right hon. Gentleman rightly said that the Clause will have the same effect upon the cash position of the exhibitor as a straightforward reduction in Entertainments Duty. I am very glad that the right hon. Gentleman has made it perfectly clear that there will be no change in the position of those who pay the statutory levy. They will remain exactly as they are now. That was not at all clear during the Committee stage.

Can the Chancellor take this a little further? By his method the cinema exhibitor will receive, if he collects as much as £20 in duty per week, upwards of £1,000 a year. That is presumably not to be considered as part of his normal income, or is it? For example, can we be told whether that will be counted for Profits Tax or Income Tax, or is this something which is taken right outside the normal income of a cinema exhibitor? If it is, the larger and more prosperous exhibitor to whom the Chancellor referred will obtain his £1,000 or so tax-free, as well as the smaller exhibitor whom the right hon. Gentleman is so particularly anxious to accommodate.

This is a very important point because, although this year the Chancellor has made a relatively small concession, we all hope that the time will come when whoever is in his place will make a very much larger one. If, as we trust, my right hon. Friend the Member for Huyton (Mr. H. Wilson) is in that place next year, we shall have no trouble, because the duty will be abolished. [HON. MEMBERS: "Oh."] I have no doubt whatever on that count.

As we are discussing this matter of principle, one should at least take the hypothetical case that there might still be a Chancellor of the Exchequer present who will make a considerably greater remission than that made this year, but not total abolition. Instead of having only £20 a week passed on, £40 or £60 a week, for the sake of argument, would be kept in the hands of the exhibitors instead of being sent on to the Customs and Excise and, also, would not be considered when other taxation was being taken into account.

Therefore, we are entitled to have an explanation from the Chancellor. As we have said at earlier stages of the Bill, we on this side are not happy at this method of not having a straight reduction in the duty. This is almost farming out taxes—that brought about the fall of France before the Revolution, as the Chancellor no doubt recalls—by allowing persons to keep in their own hands money which, in the proper course of events, should reach the Revenue. We are not necessarily financial purists in all circumstances, but we feel that it is our duty to draw the attention of the House to this change in principle which is embodied in the Clause.

The Chancellor is certainly over-optimistic in supposing that the very small relief proposed will have the effect of keeping open any very considerable number of cinemas which might otherwise close. That it is some relief is obvious, but the effect, even on the exhibitors, will probably be a great deal less than the right hon. Gentleman apparently supposes.

If, as the Chancellor suggests, this money is regarded as tax and not as ordinary income, the custom of the trade leads to the result that the whole of this money will remain in the hands of the exhibitors. The "break" figure, as it is called, between the renter of the film and the exhibitor is normally settled on the basis of tax having been paid. Therefore, the whole of this remission is obviously intended by the Chancellor, judging by what he has said this afternoon, to go to the exhibitor.

In all previous remissions of taxation for this industry the industry as a whole has been taken into account and not just the exhibiting end, but the proposed method means that the film producer on this occasion has no hope of obtaining any direct benefit from the tax remission. In this connection, if nobody else has done so, I should like to draw to the right hon. Gentleman's attention some remarks made last week at a meeting of the Executive Council of the British Film Production Association by its president. Mr. Watkins, who said categorically that the Council must … rebut the Chancellor's statement during the Committee stage of the Finance Bill that the producers were not in any difficulty. As I think I commented at the time, the Chancellor seemed to be remarkably complacent at that moment about the film production position. Mr. Watkins says very forcibly that the producers are facing serious difficulties, and I have no doubt that while they are glad that the exhibitors may be benefited by this proposal they must feel serious disquiet at a principle being introduced in dealing with this duty which, if carried any further in subsequent years, would mean that the producers stood to get nothing from this method of remitting taxation.

That seems to be a very serious objection to the method selected by the right hon. Gentleman, and I think that he owes it to those at the production end of the industry, at least, to say something of his views on their difficulties, because I can assure him that their position is by no means as favourable as he appeared to think. I very much hope that he has had further advice since he made the remark in the earlier stages of our discussions that caused very considerable concern in producer circles.

I do not wish to comment on the details of subsection (2) which, as far as we can tell, should probably work satisfactorily; and the matter of the date we can, I hope, discuss very shortly. Therefore, I sum up by saying that we are not satisfied with the amount of the concession granted by this new Clause, nor are we satisfied with the method of granting it but, of course, we have to be thankful for this very small mercy.

Mr. Swingler

It remains a mystery how the Chancellor came to adopt this present view, and I do not suppose that this afternoon we can go much further into that. On Budget day, in spite of all the representations made to him on the subject of Entertainments Duty, the right hon. Gentleman apparently had no intention of reducing it at all. He had received deputations from the trade, he had answered numerous Questions from hon. Members dealing with the decline in cinema admissions and the closure of cinemas—including cinemas in his own constituency—but had set his mind against acceding to the requests made to him.

Since then, however, the Chancellor has been subject—and I welcome it—to a certain amount of pressure, or backstairs intrigue—we can call it what we like—which has brought him to this present view on Report. Without running into the next discussion, perhaps I might express the view that, in those circumstances, it is only fair that the Chancellor should carry out his intentions as though he had adopted them on Budget day, and not add a further belatedness to this comparatively minor concession that he has produced. At any rate, he should be as fair as was the Tory Chancellor of the Exchequer in 1958 in regard to the date of the concession—but we will come on to that in a moment.

What worries us is the very small nature of this concession, as well as the amount of pressure that was required to extract it. It really is not very relevant to the present situation. If the views on Entertainments Duty over the last few years were examined, it could be very easily shown, I think, that those who have spoken as critics from the back benches have been correct in their forecasts about the underestimation of the problems of the film industry and the cinema trade.

The fact is that nearly all the reductions of this duty have been too little and too late to save large numbers of small cinemas, to do very much to arrest the general decline in cinema attendances, or to permit any large sums of money to pass from the exhibiting to the production end of the trade so as to give a real stimulus to export as well as to home market film production. That has been the general tendency.

This year, it has been clearly revealed by the right hon. Gentleman that in the Treasury there is an obstinate opinion in favour of a permanent tax on the cinema trade. That did not apply to the theatre, to football or to cricket but, as I say, the Chancellor has revealed that there is in the Treasury an idea that some form of tax on the people's entertainment should be a permanent feature of our taxation and, because there are big tycoons on the exhibiting side, that it should be the cinemas that should bear it, even though it may deny the amenity of the cinema to the rural areas or permanently cripple part of the film production industry.

That is a very bad thing, because I continue to think that the abolition of any form of tax on this sharply-declining industry is long overdue. Nobody will deny that it is a sharply-declining industry. That it has gone into a swan dive is revealed by the bankruptcies that have occurred, and by the large numbers that have gone out of the trade. We know that there are those in this House who want to kill a large part of the inlustry and do not at all mind that it is declining at the present rate, but no one can really justify the amount of taxation that the Chancellor is leaving on an industry that will continue to decline. I am sure that next year we shall again be discussing in this Chamber the further decline in cinema attendances, the further closures of cinemas in many parts of the country, and the necessity of trying to pump some more finance into the production end of the industry if we are to maintain any level of film exports at all.

Therefore, I believe that the new Clause (Reduction of scope of entertainments duty) not selected, standing in the names of my hon. Friends and myself to be better than this one, because it gives the much bigger concession that the industry needs at the present time. Indeed, what the industry needed was abolition of the duty, but the Chancellor has turned that down, and has given to the trade only a very small shot in the arm—if one can call it that at all—and one that falls far below what is necessary and desirable to put this industry in order.

4.30 p.m.

Mr. Rankin

The contention between the Chancellor and those of us who support the new Clause is on a mere matter of money. The Chancellor may think that a strange phrase to come from a Scotsman in view of the fact that he said that the Scots were a very expensive item in the national budget. But he will realise that my position here is purely vicarious. I am not talking for Scots. I am talking for other people, and chiefly for the English on the benches behind him, who have been somewhat tongue-tied so far.

Mr. Nabarro

On a point of order, Mr. Deputy-Speaker. Can you put this matter into good order and resolve it? The last three speakers have been called from the other side of the House, notwithstanding the fact that three of my hon. Friends rose on each occasion. Is it correct for hon. Members on this side to be impugned in this fashion by the hon. Member who is speaking when we are doing our best to catch the eye of the Chair and cannot catch it?

Mr. Deputy-Speaker

I have only just taken the Chair, but I think that if the hon. Gentleman is patient he may be lucky.

Mr. Frederic Harris (Croydon, North-West)

Further to that point of order, Mr. Deputy-Speaker. May I respectfully say that I have been in the House for eleven years and I have never before known an occasion when three hon. Members opposite have been called one after the other while hon. Members on this side of the House have been trying to get into the debate.

Mr. Deputy-Speaker

That is not a point of order. It is entirely within the discretion of the Chair as to who is called.

Mr. Rankin

I am sorry that a few harmless words should have stirred up so much trouble on the other side of the House. The hon. Member for Kidderminster (Mr. Nabarro) shows how ineffective hon. Members opposite are, because surely the kindliest thing to catch in this House is the Speaker's eye, and they have failed entirely to do that.

Mr. Nabarro

I did not rise to my feet.

Mr. Rankin

If the hon. Member did not rise, I do not know what he is complaining about.

Mr. Geoffrey Hirst (Shipley)

He is complaining on our behalf.

Mr. Rankin

May I proceed with what I hope to say without interruption, because I am anxious to be helpful?

I was saying that the difference between the Chancellor and those of us on this side of the House is merely a matter of money, and the amount of money is not so great, because he proposes to inject into the cinema industry £2¼ million, and we, who regard the situation as more precarious than he does, want to put £5¼ million into the industry.

I would remind the right hon. Gentleman that on 14th April this year, in reply to a Question which I put to him about the cost of our proposal, he said that the trouble was not the duty at all; it was merely that a sufficient number of persons did not go to the cinema. I wonder why it was that between 14th April and 10th June he decided that part of the trouble resided with the duty? There must be a story there that is worth telling. What convinced him and, having been convinced that the trouble lay with the duty, why does he apply it only to 886 cinemas? That is something that he has got to justify.

The great mass of cinemas in this country is in that independent middle block numbering 2,390 and one or two other units—I believe 2,394 altogether. Those are the cinemas whose seating capacity lies between 501 and 1,500. Those figures were supplied to me in a return by the Board of Trade in its publication of 3rd April. This great group of 2,394, on the Chancellor's own confession this afternoon, will not be greatly helped by what he is doing. Those cinemas will, of course, get £20 a week, but then, after we have subtracted the £20, their tax liability will still be so great as ultimately to close down more and more of these cinemas.

The more of these cinemas that the right hon. Gentleman closes down the more will he reduce the statutory levy and the more will he endanger the export of British films—an absolute necessity in the view of all hon. Members on this side of the House—because of the lack of a good home market. If we are not to get the home market which we could only get with help from the Chancellor—more help than has been given so far—we shall endanger our export trade, and if we do that we shall endanger British film production as a whole. The Chancellor knows that argument very well, and, because he knows it, I do not understand why he did not underline it in words of glowing hope by saying that he would apply the logic which is enshrined in the new Clause (Reduction of scope of entertainments duty), standing in my name. It was a good Clause, as the Chancellor knows.

The Chancellor said, first, that it was not practicable. But, surely, if we can work the tax-free allowance now as we are doing, we can still work it if we raise the limit to 2s. 6d. There can be no argument about that. If we change the tax-free limit it must still be workable. I see that the Chancellor is in consultation. I do not know whether he is verifying my figures. I take it that we shall hear something about this, and that it may be possible to bridge this unbridgeable gap between £2¼ million and £5¼ million.

If I may say a word which will appeal to Scottish cinema managers, I would ask the Chancellor to consider one matter in connection with his proposed new Clause. Of course, I do not object to what he is giving. We will take anything—except the present Chancellor, of course. We should like another one. However, that opportunity will come later. We will take what is given, and I do not quarrel with the machinery of the Clause. I would ask the Chancellor to consider the fact that the holiday season in Scotland is now in full swing. July is the great holiday month. The season starts at the beginning of June and it goes through July and on to August when, of course, we give way to the English, who invade our territory for murderous purposes.

The Chancellor wants this Clause to help the small man. The small cinema proprietors in the Scottish holiday resorts look forward to the holiday period to make up for the long barren spell of the winter, and just now the visitors will be coming to these resorts about which the hon. Member for North Angust and Mearns (Sir C. Thornton-Kemsley) spoke in Committee.

Mr. William Shepherd (Cheadle)

On a point of order, Mr. Deputy-Speaker. Am I right in assuming that we are not now discussing the Amendments to this proposed new Clause? I understand that the hon. Gentleman intends to talk about the timing of this remission, but I was under the impression that we were to discuss the question of the timing later.

Mr. Rankin

Further to that point of order. The hon. Member may not have seen that in the new Clause there is a reference to the Entertainments Duty chargeable starting on "the second day of August". If that is contained in the new Clause I understand that at least I may make passing reference to that date.

Mr. Deputy-Speaker

The Amendment will be called after the new Clause has had a Second Reading.

Mr. Rankin

I shall reinforce later what I was about to say. This will give the Chancellor a period in which he can think about what will be said later in the debate. There is no harm in warning the right hon. Gentleman that he may have one or two arguments to counter.

I am suggesting that he should consider another date which I shall suggest to him, with your help, Mr. Deputy-Speaker, later. I will not mention the date now, but I feel that the date in the new Clause will not be as helpful as the right hon. Gentleman himself desires to be because it will not give as much benefit to these cinemas during the Summer, since it falls in the last holiday month in the Scottish year. It does not matter to anyone who is interested in carpets, but it matters to those who are interested in cinemas. They want to see as many people as possible attending the cinemas. I hope that the Chancellor will reconsider the date 2nd August and substitute a more helpful date.

That is all I want to say at the moment. I could have said more but I shall forbear so as to give to hon. Members opposite, who are so anxious to talk, the chance to show the other weaknesses which lie in this new Clause, which commends itself to the small man but, in my view, ignores the great mass of cinemas, which today need as much help as the small man is being given.

Mr. Nabarro

I want to intervene only for a moment to say that in the course of the last two or three years the Chancellor has been extremely generous to the cinema industry. Last year, he reduced the duty by £14 million. This year, he proposes in the new Clause to reduce it by a further £2½ million. That will leave a residual of only £6¾ million to be paid by the cinema industry in duty.

I think that that compares very favourably with the amount of duty which is to be paid by the principal competitors of cinema—namely, television. If television is to be taxed at the rate of £30 million per annum in Purchase Tax, with a further £10 million per annum in allocation of licence duty—a total of £40 million—in my view it is not unreasonable that the cinema industry should make a contribution to the revenue of a modest £6¾ million. That is a ratio of £6 to £1, weighted in favour of the cinema. It means that the television industry is carrying about six times as much in taxation and duty as is the cinema. The hon. Member for Newcastle-under-Lyme (Mr. Swingler) nods. These are established figures.

Mr. Rankin

Surely the hon. Member realises that the major circuits in the cinema industry, such as Granada and A.B.C., are all concerned in television and are paying their cinema tax out of television profits. For example, last week A.B.C. declared 40 per cent. profits. This was because of television, not because of cinemas.

Mr. Nabarro

That is an entirely irrelevant argument. All profits of all corporations are appropriately assessed to both Profits Tax and Income Tax. If the television companies make a large sum on their annual trading account by way of profits, they will surely pay an aggregate of 48¾ per cent. annually as between Profits Tax and Income Tax.

4.45 p.m.

The third point which I make is the critical point in the debate. There are greatly changing social habits in this country, arising from television. It is manifest nonsense to say that the decline of the cinema is largely due to the incidence of this relatively small amount of Entertainments Duty. The reason for the decline in the popularity of the cinema is assuredly the competition of the cinema set in the form of a television in 8½ million homes. Based on present statistics, with about £40 million annually, being paid by television interests as an amalgam of the licence fee allocation and Purchase Tax, it is certainly not unreasonable that one-sixth of that sum, namely, £6¾ million net, after this Clause is effective, should be paid by the cinema industry as its contribution to the national revenue.

Mrs. White

Does not the hon. Member agree that in his arithmetic he should add the Purchase Tax paid by the cinema exhibitor on all his equipment, seating, carpets and other facilities? Is not that a perfectly fair way of computing the total tax paid?

Mr. Nabarro

No. I entirely disagree. Certainly, the cinema exhibitor has to pay a small sum in Purchase Tax—12½ per cent.—on the floor coverings, including carpets, in his cinema, but the viewer of a television set in his home has to pay a substantial sum in beer duty upon his convivial refreshments while he is watching the television set in his house. That is a comparable form of indirect taxation. The point made by the hon. Lady is entirely invalid.

Mr. Barnett Janner (Leicester, North-West)

I had not intended to intervene in the debate until I heard the so-called argument of the hon. Member for Kidderminster (Mr. Nabarro).

Mr. Nabarro

It was a jolly good argument.

Mr. Janner

Let us see whether it was a jolly good argument.

The hon. Member contended that there is no longer any need for that form of entertainment given by cinemas because it is being entirely superseded by a different form of entertainment. If he were right there would be something to be said for not removing the tax entirely, but in my view it is not consistent either with the facts or with the type of argument used by the Government on previous occasions on forms of entertainment.

The Chancellor told us previously that he did not intend to drive out of existence any reasonable form of entertainment by the tax which was being imposed, and that if it were found that the incidence of taxation was such that it would drive a form of entertainment out of existence, the tax would be removed. Accordingly, it was removed from certain forms of entertainment such as boxing and football. The cinema exhibitors are in a precarious position.

Mr. F. A. Burden (Gillingham)

When the hon. Member is comparing the cinema with television and with boxing and football he is not comparing like with like. In one case it is live entertainment and in the other it is canned entertainment.

Mr. Janner

That is precisely my argument. The hon. Member for Kidderminster compared two forms of entertainment. The cinema is a form of entertainment which appeals to certain people, and there are a large number of people who still wish to go to cinemas. We can start with that presumption, and if we accept it we should give facilities for the trade to continue and not, as the hon. Member for Kidderminster wanted, try to make everybody sit at home at a television set, whether wanting to go to the cinema or not.

Cinemas throughout the country are closing down. We have that sad experience in my constituency. One of the main reasons for not being able to continue is that this tax operates against them. If it were removed, there would be an incentive to those who are running this form of wholesome exhibition to provide what a large section of the community believe is necessary for them.

I am very upset about the present position of the cinemas. I have seen the people who are concerned with it in Leicester. I know what the population of Leicester wants. I agree that, in the main, people are turning to television, but there is a considerable section of the community in Leicester which wants to continue to go to the cinemas. Cinemas have to renew their equipment and to make their amusement attractive to people who will have to leave their television sets, and all that costs money. I hope that the Chancellor will examine what has been said on previous occasions about other forms of entertainment and will see that the cinema industry is not pushed out of existence.

The cinema industry obviously wants to remain in existence. It has served a very great purpose and has done something for the people which cannot be assessed in ordinary financial terms. It is worth while to continue it, and the people want it to continue. We ought not to strangle it by imposing a tax which is quite unjustifiable, the removal of which would mean a very small burden on the Exchequer.

Mr. Shepherd

It would be ungrateful of me if I did not say how pleased I am to see on the Notice Paper a proposal which I have put forward in this House for many years in respect of the cinema industry. Despite the rather disgruntled view—[HON. MEMBERS: "Sour."]—sour view expressed from the benches opposite—

Mr. Rankin

No. On a point of order. Is it within the realms of fair debate, Mr. Deputy-Speaker, that the course of this even-tempered discussion should be utterly misrepresented by the hon. Member for Cheadle (Mr. Shepherd)?

Mr. Deputy-Speaker

If anything is being said which is out of order I shall stop it.

Mr. Shepherd

I do not think that there is reasonable doubt that the course proposed is the best method of giving the greatest relief to those who need it in this industry, especially when we are dealing with a limited sum of money. Therefore, I agree heartily with my right hon. Friend. The assumption that the money which is repaid in the form of tax is to lie in the hands of the exhibitor untouched is something which I could not possibly concede. I am sure that when my right hon. Friend replies he will set at rest any doubt which may exist on that score.

There will be more than the Revenue after this £20. The hon. Member for Nottingham, West (Sir T. O'Brien) and his union will be after part of it. The hon. Lady the Member for Flint, East (Mrs. White) suggested that the money could not benefit the producer. That is rather a naive view. If an exhibitor were doing rather better there would obviously be a tendency for the renter to ask more onerous terms from the exhibitor, and I should be surprised if, after twelve months, the producer did not get something out of the pool.

The point made by the hon. Lady the Member for Flint, East requires an answer. She rather chastised my right hon. Friend for taking too rosy a view of the industry. I would like to chastise her—if I may put it in those terms—for taking too dismal a view of it. If she would look at the figures I think she would find the position not quite so discomforting as she has imagined. If she went further into them she would find that the amount of money invested in films in this country has been probably an all-time record. Although there may have been slightly fewer films produced, much more money was spent on each film. The position of the producer is nothing like as deplorable as the hon. Lady makes out.

I did not follow the arguments of the hon. Member for Leicester, North-West (Mr. Janner) about absolute remission. We could not give £9 million for the salvation of the cinema industry.

Mr. Janner

Why not?

Mr. Shepherd

Some of the remission would undoubtedly fall by the wayside. Of course, that argument applies to what we are proposing to do now, I admit, but a very large part of total remission would go to the well-equipped and well-financed large circuits, probably £4 million or £5 million although they are not in need of assistance, having rationalised themselves. Because we could not spend £9 million on the salvation of the cinema industry, my right hon. Friend the Chancellor of the Exchequer is justified in bringing forward this limited assistance, directed specifically at the areas most in need of support.

This industry needs watching. It may be that the views which I now express will need revision twelve months' hence. If the industry then needs further assistance, I am sure that my right hon. Friend—who will still be here—will give it.

Mr. Janner

Will the hon. Gentleman say whether it is true or untrue that many cinemas are closing? If it is true, what on earth is the use of imposing a tax which contributes towards this situation?

5.0 p.m.

Mr. D. Marshall

In opening the debate my right hon. Friend said that two things had influenced him in his decision. One was whether there was an alternative, and the other was the question of variety in rural districts. I can assure my right hon. Friend that those of us who live in rural districts, and have friends who have been wondering whether or not these small cinemas can keep open, are extremely grateful for what he has done. I have received many letters asking me to convey the thanks of the writers to my right hon. Friend, and I am glad that I have had the opportunity to do so.

Mr. Hirst

I thank my right hon. Friend for introducing the Clause, which follows up all but one of the requirements I mentioned on behalf of my right hon. and hon. Friends in Committee. We had better deal with the exception later. The Clause includes the additional point in regard to the exemption limit.

I take a poor view of the Opposition, who have been a little sour this afternoon. The Clause represents a further reduction on top of the reduction last year and a previous reduction. Over £20 million has been remitted by the Conservative Government. Although it is true that the circumstances were quite different, in the days of the Labour Government the only thing they did in this matter was to raise the tax. In view of that, they might have been more generous and forthcoming today. From the letters I receive, and from the contacts I have made in my long experience of the matter, I know how grateful people are for this concession.

Mr. Harold Wilson (Huyton)

The hon. Member has made a comparison between the situation now and that which existed at the time of the Labour Government. Can he say how many cinemas closed during the Labour Government's tenure of office, and how many have closed during the last eight years of Conservative Government?

Mr. Hirst

That has nothing to do with the matter. The right hon. Gentleman forgets that, owing to the increased prosperity under Conservative rule, there are now 8 million television sets.

My hon. Friend the Member for Cheadle (Mr. Shepherd) and the hon. Member for Flint, East (Mrs. White) referred to the amount of benefit which this reduction in Entertainments Duty will confer upon the industry. The hon. Lady made the same point today as she did in Committee, and I cannot see her argument. I do not think that I ever will see it. She said that the whole amount goes to the exhibitor, but that is not so. After Entertainments Duty has been deducted a great deal of the division takes place upon a percentage basis. About half goes to the exhibitors and another half to the renters, and included in the latter half is a production element. It is an indirect benefit to the whole industry.

I made that point in Committee, and I think that most hon. Members agreed with me then. We must not look at this question, or expect the industry to look at it, from the selfish aspect of one side. We cannot split exhibition from distribution or production. The three must be helped, and must go forward and be made efficient together. I maintain that what my right hon. Friend has done achieves precisely that end.

The concession will certainly help the medium-sized cinemas. The hon. Member for Glasgow, Govan (Mr. Rankin), in a rather off-moment speech, said that £20 million, or £1,000 a year, would not be of direct benefit to them. He argued that they would make more profits and be taxed on them. I would point out that they are not taxed on losses. Of course, this concession is a benefit to them, as it is through the whole range of cinemas. I am grateful to my right hon. Friend for conferring it.

Mr. John Baird (Wolverhampton, North-East)

I am reluctant to enter this debate, but I must make one point after listening to some of the speeches of hon. Members opposite. If we are going to subsidise a dying industry we shall waste our money. The only way in which this concession will help is by getting more people into the cinema. The hon. Member for Cheadle (Mr. Shepherd) told us that some of this concession will go to the workers in the cinema industry and some to the producers, exhibitors and renters. I should like to know how much will be left for the general public who visit the cinemas. If all this money is handed back to the industry and no concession is made for the public whom we are trying to encourage to visit the cinemas more often, we are wasting our time and money. The sum suggested is far too meagre. The only way to get more people into the cinemas and, thereby, to encourage the industry, is to make the concession much more substantial.

Mr. Burden

I find it very difficult to understand many of the arguments put forward by the Opposition. If we examine the Government's record in regard to the cinema industry we find that last year they gave tax remissions amounting to £14 million and that this year the figure amounts to £2½ million. In addition, the entertainments industry should be specially grateful to the Conservative Government, for they have also abolished the tax on the live theatre, as well as on cricket, football, boxing and greyhound racing. All this adds up to a fairly good effort on behalf of the entertainments industry generally.

Mr. Swingler

The hon. Member talked about tax reliefs amounting to £14 million last year and £2½ million this year. Does not the hon. Member agree that those are purely theoretical and notional figures? If the Chancellor had maintained the existing rate of Entertainments Duty last year he would never have collected £14 million, any more than he would have collected £2½ million this year.

Mr. Burden

My figures are just as notional in a downward direction as the figures were notional in an upward direction when the Opposition were the Government.

The hon. Member for Leicester, Northwest (Mr. Janner) said that people could not afford to go to the cinema in Leicester. If that is the view of the Opposition this tax allowance will certainly not make it possible for more people to go. As my hon. Friend the Member for Kidderminster (Mr. Nabarro) said, there is a changing patern of public need for entertainment. If the Opposition became the Government I wonder whether they would immediately abolish I.T.V. They fought against it very hard before it was introduced, and I have no doubt that they were then bearing in mind the interests of the cinema industry.

Mr. H. Wilson

Does the hon. Gentleman recall that the fight was led in another place by Lord Hailsham? Will the hon. Member put his question to Lord Hailsham?

Mr. Burden

My noble Friend is quite capable of looking after himself without any help from the right hon. Gentleman.

Mr. Wilson

I am only aware that Lord Hailsham entirely refuses to answer any challenge which is put to him.

Mr. Burden

My noble Friend is used to dealing with heavyweights. I do not see why he should be expected to take on lightweights.

Mr. Rankin

On a point of order. Is is not true that Lord Hailsham is gradually coming down into the lightweight class?

The Chairman

That is not a point of order.

Mr. Burden

Some concern has been expressed about the production side of the industry, and my hon. Friend the Member for Cheadle (Mr. Shepherd) made some particularly good points in that connection. I would remind hon. Members opposite that a very great sphere for the production of films in this country is opening in the television world. Many of the television films which employ our artistes are now going to America and the Commonwealth, and they ensure further employment in the industry besides earning us a good deal of overseas currency.

We come back to the fundamental point that, whatever we may say in this House, we cannot change the pattern of life. If a really good film comes out—and there are very few of these—the cinema which shows it is always full. Nowadays people can sit the whole evening and see on television short films comparable to the sort of second-feature films that they used to have to go to the cinema to see. It means, of course, that the public has become much more selective. That is inevitable, because so few great films are made today that only one or two cinemas in each town can show them at the same time. The cinemas that show them are filled with people wishing to see them, but the ordinary public just will not turn up, whatever my right hon. Friend or anybody else may do, to see sub-standard films when they can watch television in their homes.

I think that, generally, my right hon. Friend has done a great deal for the cinema industry, and, indeed, all that he possibly could have done at this stage.

Mr. Amory

There are only one or two comments I wish to make in amplification of what I said at the beginning of the discussion. I would like to thank my hon. Friends who have spoken for their appreciation of the proposal which I am making today

Mr. H. Wilson

Although we are all delighted to hear the Chancellor, has he not omitted a pure formality—should he not have asked the leave of the House before making a second speech?

Mr. Amory

I agree. If the House will allow me to speak a second time, I should like to do so. The right hon. Gentleman has quite properly reminded me of that.

Mr. Deputy-Speaker

The right hon. Gentleman moved the new Clause and he has the right to speak again.

Mr. Amory

May I propose an amendment, and say that the remark of the right hon. Gentleman was most improperly, instead of properly, made?

As I was saying, I should like to thank my hon. Friends for the appreciation they have shown of my proposal. There has been some discussion as to whether the reception given to the proposal from the benches opposite has been somewhat less than enthusiastic. I think it was the hon. Member for Leicester, North-West (Mr. Janner) who admitted that he felt disgruntled. I remember P. G. Wodehouse in one of his books referring to someone and saying that if he was not disgruntled he was certainly not positively gruntled. I think that applies to the kind of attitude shown by the hon. Gentleman today.

In reply to the hon. Lady the Member for Flint, East (Mrs. White), I would say that this payment of £20 a week will be income in the hands of the recipient, that is, the proprietor of the cinema, in exactly the same way as any other income received from his business and box office takings, and, therefore, that it will be taxable. The hon. Lady also raised the question of the share as between the exhibitor and the renter. Of course, that is entirely a matter for the trade to settle. Members of the trade have an arrangement which they have agreed among themselves for settling the apportionment of their present income. It would be for them to consider, in the light of what the House decides, whether they would wish to continue that arrangement or substitute some other arrangement. I think that also answers the point raised by the hon. Member for Wolverhampton, North-East (Mr. Baird) about the benefit that would accrue to the general public. It would, of course, be entirely for an individual cinema proprietor to decide whether he wished to pass on any of this benefit to the public in lower prices.

The hon. Member for Glasgow, Govan (Mr. Rankin) said something that seemed to me to imply that he thought we were not helping all cinemas by this proposal. I think he will agree that we are helping all cinemas that, in fact, pay Entertainments Duty at the present time.

Mr. Rankin

I think I made it perfectly clear that while, of course, every cinema will retain the £20, the tax liability for the 2,394 cinemas which I have mentioned beyond the £20 is too great.

5.15 p.m.

Mr. Amory

I would not dispute that, and I apologise to the hon. Gentleman if I did not completely understand his point. The hon. Gentleman asked me whether I had changed my mind and referred to a previous statement I made that in my opinion the main cause of the plight of the cinema industry is really basically lack of attendance. No, I have not changed my mind about that. I gave that as my opinion last year and I still think that is the reason this year. But, having stated that as the main reason for its plight, that did not, of course, prevent me understanding the plight and helping within the scope that I thought justifiable. This will be the third year running that the Government hve relieved the cinema industry.

Mr. Nabarro

That is what I said.

Mr. Rankin

We know that.

Mr. Amory

I realise that this is a very limited sum which I feel able to devote to this purpose. I understand full well that many hon. Gentlemen wish very much that it could have been possible to make it a bigger sum. I understand that, and I too wish that it had been posible. But this year, in the context of everything that has been done, I judged that this was as much as I could devote to this purpose.

I did change my mind to this extent. At the time of the Budget I did not think that I could justify even this sum for the assistance of the industry. It may be that the points made by hon. Gentlemen on both sides of the House in our debates have emphasised to me the extent of the plight that the industry is in. Particularly was I sympathetic to the position of those cinemas in the smaller towns and where there is only one cinema in a town. There was a borderline case which I felt I could help within the means that I could devote to this object. I hope that the method we have chosen is not going to lead to a general farming out of taxes in the way the hon. Lady reminded me was common in the days before the French Revolution. I think the Minister concerned was a M. Necker or a M. Turgot—I do not know which.

Mrs. White

M. Necker.

Mr. Amory

I have not much in common with M. Necker. Certainly I shall not leave the country rather hurriedly as he did. It is even rumoured that a diamond necklace left the country at the same time. However, I must not pursue that matter further.

Finally, I recommend the House to accept the proposal as a practical contribution to the problem of which we are all conscious.

Mr. H. Wilson

I do not propose to detain the House for more than a minute or two. I think that our attitude has been made clear. We wanted the complete abolition of the Entertainments Duty. The point has been made in many parts of the House that the public has now to a considerable extent deserted the cinema for television. We believe that other forms of entertainment are much more profitable and capable of making a greater contribution to the Chancellor's requirements than is the cinema industry. That has been our view. We pressed it to a Division in Committee when we were, unfortunately, and not for the first time—though I think for the last time—outnumbered. On that occasion we failed to carry the Chancellor with us.

We obviously welcome the small relief as far as it goes, and that is why we do not propose to vote against it. At the same time, we think that it is too small, and, for the reasons given by my right hon. Friend, that it has been done in a wrong way and raises a number of awkward problems. I hope that the Chancellor's proposal is not going to lead to a widespread system of abuse in the collection of taxes by the extension of the use of publicans, in the biblical sense of the phrase. I hope that these fears will prove to be unfounded.

We do not believe that the right hon. Gentleman has gone anything like far enough and that, in so far as he has made a small concession, he could have done it better in other ways. However, as I have said, we do not propose to vote against the Clause.

Question put and agreed to.

Clause read a Second time.

Mrs. White

I beg to move, as an Amendment to the proposed Clause, to leave out "second day of August" and to insert "tenth day of June".

This is, of course, a relatively minor matter, but we think that the Chancellor would be very well advised to accept this Amendment and to make this small concession. He will appreciate that what we are asking him to do is to allow this tax relief to run from the day on which he made the announcement in the House of Commons. One of my hon. Friends, I think, suggested that he should go back as far as Budget day and compared the case with that in 1958, but in 1958 we had a Budget Resolution and the situation is, therefore, not strictly comparable. We, therefore, feel that the proper date on which we may reasonably ask that this tax rate should be begun is the day on which the Chancellor informed the House that it was his intention to make this remission.

This is of some importance to the seaside resorts and to holiday trade in general. The Chancellor will appreciate that his method of £20 a week remission is not as helpful as it might be to cinemas which depend on seasonal trade, because a number of them may collect in duty more than £20 in the height of the season and will, therefore, have to pay over the balance to the Revenue, whereas in the winter months they may make considerably less than £20. He has made no provision in the Clause for a P.A.Y.E. arrangement for carrying it from one week to another. Therefore, he has a particular obligation to look at the position of the seasonal cinemas. It is with them in view that we move this Amendment.

It is only for this year that this applies. It is a matter of some seven weeks and a maximum of £140 per cinema. We feel it is a very small concession for the Chancellor to make when the total concession he is making is a relatively minor one for the industry.

My hon. Friend the Member for Glasgow, Govan (Mr. Rankin) has mentioned that in Scotland July, in particular, is a very popular holiday month. It is true of a number of other resorts that they reckon to do a considerable part of their holiday trade before August.

I hope that for these reasons the Chancellor will feel inclined to accept this Amendment. It is true that the date proposed comes into mid-week, but I do not think that the arithmetic involved is great. We think that this is the proper date, constitutionally speaking, to choose.

Mr. Rankin

I beg to second the Amendment.

If the right hon. Gentleman will accept this Amendment he will be doing something which will be of immediate benefit to the type of cinema to which my hon. Friend the Member for Flint, East (Mrs. White) has referred. When I was speaking earlier I referred, as hon. Members on both sides will recollect, to the position of Scotland—and I hope that Scotland is never a tedious subject even to the hon. Gentleman who has just quietly suggested it is. It is a fact that it is during the holiday season that these cinemas hope to recoup themselves for the period of small admissions during the long out of season months. If the day proposed in the new Clause remained, a great many of those cinemas would still hot get the benefit which I am perfectly certain the right hon. Gentleman wants to see them get. We on this side are neither disgruntled nor gruntled on this matter. We merely want to be helpful to this industry in the seaside resorts. It will be of some benefit to them if the Chancellor will think of another date.

My hon. Friend said that 10th June fell in the middle of a week and that, therefore, the arithmetic might be a little difficult for the Treasury. I do not know, hut I do not want to create any difficulty for the Treasury in adding and subtracting and multiplying and doing all those mysterious things with the money. The hon. Member for Cheadle (Mr. Shepherd) has tabled an Amendment suggesting that the date should be 7th June, and that involves retrospective payments. There may be a difficulty about that date, too. If there is any difficulty about the date, then 14th June, which is the beginning of a week, should involve no difficulty on the mathematical side whatever, and is a difference of only a day or two.

So we are giving the Chancellor all the help which a good Opposition can possibly give in these circumstances, and I hope that he will respond by accepting the Amendment.

Mr. Deputy-Speaker

Before I call the Economic Secretary, I wish to apologise to the House, because I made a mistake a few minutes ago. The right hon. Gentleman the Chancellor of the Exchequer had not the right to reply to the previous debate.

Mr. Amory

In view of that, Mr. Deputy-Speaker, may I withdraw the word "improper" which I subsequently used in reference to the right hon. Gentleman the Member for Huyton (Mr. H. Wilson) and replace it with the word "proper", which I had originally used?

Mr. Deputy-Speaker

I apologise to the House. I was wrong.

The Economic Secretary to the Treasury (Mr. F. J. Erroll)

I think it might assist the House if I were to intervene at this stage in this short debate on the Amendment to the proposed Clause. While we fully appreciate the reasons which prompted the hon. Lady the Member for Flint, East (Mrs. White) to propose the date 10th June, it would, of course, be a difficult date to use, because it would come in the middle of a single week when the tax due is normally paid weekly. For that reason, we would very much prefer the Amendment on the Paper in the name of my hon. Friend the Member for Cheadle (Mr. Shepherd), which proposes 7th June. This, being a Sunday would be the correct day on which to make the change, and that day of the week has already been incorporated in our new Clause, namely, Sunday, 2nd August.

However, there is the question whether one should go back in point of time in this way on the Report stage of a Finance Bill. There are, of course, perfectly respectable precedents for choosing the date of 2nd August which is proposed in our Clause. When the duty was being altered in 1950 on Report of the Finance Bill of that year, and on Report of the Bill in 1951, and again on Report of the Bill of 1952, the changes in the cinema tax, as it is popularly called, the Entertainments Duty, were all made effective subsequent to the passing of the Measure.

Mrs. White

The hon. Gentleman will appreciate that what he is now referring to was a straight reduction in tax where the question of the seasonal effect did not apply?

Mr. Erroll


In 1952, on Report, the Amendment was for a reduction of the duty on the 9d. seats, but as the right hon. Gentleman the Member for Huyton (Mr. H. Wilson) referred to 1950, the change was a relatively small adjustment, only a matter of £300,000 per annum.

My right hon. Friend has considerable sympathy with the object of the hon. Lady's Amendment. He has particularly in mind the special difficulties of the cinemas at seaside resorts to which the hon. Lady and the hon. Member for Glasgow, Govan (Mr. Rankin) referred. However, there is a difficulty, because the Amendment, quite apart from the date question, whether the date should be 7th June or 10th June, would not have the effect intended.

5.30 p.m.

It is rather complicated to explain, but if hon. Members will look at Subsection (1) they will see that the new Clause enables a person to deduct the amount of £20 from the duty which he would otherwise be required to pay. As he pays weekly, he will have already made a number of payments, and the Amendment in the form described would not empower the Customs to make refunds. Nor would the person be able to make deductions from the weekly payments until the Finance Bill had become an Act. As soon as it is an Act, he would be able to deduct his £20 per week. So the insertion of this altered date as of itself would not provide the relief which is desired.

Mr. Rankin

Does the hon. Gentleman now realise that if the Chancellor had accepted my suggestion that the tax relief should be raised from 1s. 6d. to 2s. he would still have given the same amount and have been able to make a retrospective payment?

Mr. Erroll

The hon. Gentleman should credit us with a certain amount of ingenuity. We have been thinking about this matter, and we have devised a method whereby the relief can be given back to the 7th June this year. If the hon. Lady would be prepared to withdraw her Amendment, I would then immediately propose a manuscript Amendment, which I would explain to the House and which, I hope, the House would accept.

Mrs. White

I beg to ask leave to withdraw the Amendment to the proposed Clause.

Amendment, by leave, withdrawn.

Mr. Erroll

I beg to move as an Amendment to the proposed Clause, at the end to add: (4) In respect of the week beginning with the seventh day of June 1959 and subsequent weeks before the one beginning with the said second day of August the Commissioners of Customs and Excise shall make such repayments of duty as are necessary to secure that no greater amount of duty shall be ultimately paid than if the foregoing provisions of this section had applied to those weeks.

Mr. Douglas Jay (Battersea, North)

Can the hon. Gentleman now tell us whether these refunds of duty will be taxable income in the hands of the recipients?

Mr. Erroll

I think the right hon. Gentleman might allow me to explain this Amendment before he starts questioning me on it.

The effect of the Amendment is that proprietors will go on paying as at present until 2nd August. Then repayments will be made in respect of the first £20 or such lesser sum as may be repayable in each week dating back to 7th June. The House will have noticed that we have adopted the date of 7th June, which was the date proposed by my hon. Friend the Member for Cheadle. This relief is quite substantial. It will amount to approximately £400,000 of extra relief to the cinema industry. It will be afforded to the industry this year, and it will come quickly. This sum will be made available by going back eight weeks. Instead of starting the relief on 2nd August, if the Amendment is accepted by the House, the effective date will be brought back to 7th June and repayments will be made as soon as possible after 2nd August.

I hope the House will be satisfied with my brief explanation. We are sorry that it was not possible to table the Amendment on the Notice Paper so that hon. Members could have studied it, but I hope that what I have said will make it quite plain to hon. Members and that they will agree to its acceptance.

Mrs. White

We are delighted for once at the ingenuity of the Treasury. We, of course, accept the proposed Amendment to the Clause in the spirit in which it is moved. We fully appreciate that it is very much easier to do this at the beginning of a week. We did not wish to deprive the industry of any days of tax remission it might enjoy. On the other hand, bearing in mind the very strong feeling of hon. Members opposite against any retrospective legislation, we thought that even three days might be more than they could swallow. Therefore, we were, as I think I explained, keeping this matter of constitutional propriety in view when we suggested the tenth day of June.

If hon. Members opposite can spare it with their consciences to be retrospective for three days, we shall assume that this is a mere peccadillo and we shall not hold it against them on future occasions. I am sure that the proposed relief will be very much welcomed in various seaside resorts. It is true that the seaside resorts seem generally to be represented by Conservative Members of Parliament, and it may be that that consideration was in the Chancellor's mind when he decided to make this remission. Nevertheless, we do not wish on this occasion to be churlish or disgruntled, and we welcome the Amendment.

Sir T. Low

I do not want to rise to the bait which the hon. Lady the Member for Flint, East (Mrs. White) held out to us about retrospective legislation. She has not understood the case from this side of the House, which is opposed to the introduction of tax affecting acts which were, at the time when they were done, free of tax or subject to a lower tax. We have never carried the case to a doctrinaire extreme, which is so typical of hon. Members opposite.

I want to say thank you to my right hon. Friend the Chancellor and to my hon. Friend the Economic Secretary for having made this Amendment and for the ingenuity which they have shown at the very last minute. I welcome it very much. At the same time, I apologise to the House for my absence during the last hour on an unavoidable matter. I also express my thanks to them for adopting the general effect and principle of the Clause standing in my name on the Committee stage.

I am happy to say, now that the date has been altered, that they have gone far nearer to the general effect of that Clause than they had when the second day of August was in the Clause without this proviso.

On this Amendment the seaside resort point has not had a chance so far of being put from this side of the House. My right hon. Friend will be aware, as the hon. Lady for Flint, East said, that a great many of us represent seaside resorts, and we have been aware of the specially bad effect that this would have on seaside resort cinemas unless the Clause had been amended as it has been. It is for that reason, as I happen to represent the premier seaside resort in this country, that I should like to thank my hon. Friend for the Amendment.

Mr. H. Wilson

I would not have spoken on this Amendment had it not been for the right hon. Gentleman the Member for Blackpool, North (Sir T. Low), I do not intend to be drawn into an argument on retrospective legislation, apart from the fact that I would very soon be out of order. I would, however, point out to him and to other hon. Members opposite that they are guilty of having voted for an iniquitous piece of legislation in this present Session, which is not to the benefit of the taxpayer but to his detriment, in town and country planning. I shall not pursue that because I would be out of order.

Obviously, we welcome the fact that the Government have moved a manuscript Amendment, but it might have been better and more convenient to have put the Amendment on the Notice Paper. I do not know why they should not have done that. They had plenty of time to think about it. It would not be convenient to propose a change in the date mentioned in the Amendment, but since the right hon. Member for Blackpool, North has mentioned that this stems from a proposal made in Committee in his name, would it not have been simpler to back-date it not to the 7th June but to the date when it became known in the newspapers that the Government intended to accept an Amendment in the right hon. Gentleman's name, since that was a Sunday and it would have been as appropriate from the taxpayer's point of view as the date now proposed?

Mr. Shepherd

I should like to thank my right hon. Friend the Chancellor and my hon. Friend the Economic Secretary to the Treasury for incorporating my Amendment in the manuscript Amendment. I am sorry that I put my Amendment down in the form I did. I realised that it might be inadequate, but late on Friday night I had not the time nor the ability to make the necessary construction. I am grateful to my right hon. Friend and my hon. Friend for this assistance to the seaside cinemas. This is one of those occasions when we can fiscally differentiate between the socially desirable and the socially undesirable, and the seaside cinemas have to keep going in winter time to provide an essential service in the summer.

Amendment agreed to.

Clause, as amended, added to the Bill.