HC Deb 26 March 1959 vol 602 cc1487-9
1. Mr. Nabarro

asked the Chancellor of the Exchequer whether he will now state, following the end of hire-purchase restrictions and the credit squeeze, what general principles guide him in the application of particular Purchase Tax rates to particular products; what regard is had to stimulating export trade, or social requirements, or helping particular areas affected, particularly by unemployment tendencies; to what extent his adjudication in these matters now rests upon revenue considerations; and, having regard to the rapid change in national economic circumstances during the last 12 months, whether he will reconsider and restate his principles with regard to Purchase Tax policy.

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

My right hon. Friend sees no need to reconsider the general principle which his predecessor explained to my hon. Friend on 10th December, 1957; namely, that in all decisions on the rates and incidence of Purchase Tax the interests of trade' and the consumer have to be balanced with the necessity to raise a given revenue.

Mr. Nabarro

Yes, but there is an interregnum between now and 7th April, and having regard to the fact that these matters have not been reconsidered since 10th December, 1957, which is 18 months ago, would not my right hon. Friend the Chancellor of the Exchequer be well advised to give further consideration to a restatement of all principles governing application of Purchase Tax rates, in his Budget statement, or shortly thereafter?

Mr. Erroll

The general principle was stated to my hon. Friend on 10th December, 1957, but that does not mean to say there has been no further consideration of it, and, of course, we are not allowed to forget the subject, thanks to the number of Questions my hon. Friend puts down.

Mr. Nabarro

So far, 198.

Mr. Erroll

I am quite sure my hon. Friend would not expect me to give any indication of what might be in my right hon. Friend's Budget statement.

Mr. Chetwynd

Is not it high time that the interests of the consumer were placed first now, and is not it also time now that Purchase Tax, which still remains on household goods, should be withdrawn?

Mr. Erroll

That supplementary question, I am sorry to say, can draw from me only the usual answer that I cannot anticipate my right hon. Friend's Budget statement.

2. Mr. Nabarro

asked the Chancellor of the Exchequer what would be the diminution of revenue in a full year if razors, razor blades, razor strops, shaving soaps, shaving creams, and pre- and post-shaving lotions, now subject to Purchase Tax at 60 per cent. or 30 per cent., were made tax free.

Mr. Erroll

About £3½ million.

Mr. Nabarro

Has my hon. Friend in his researches, failed to observe that the Purchase Tax on razors and blades is still at the rate of 30 per cent. whereas Purchase Tax on cutlery is at the rate of only 15 per cent.? Why is it necessary to tax shaving twice as heavily as taxing the cutting of food? This is my 199th Purchase Tax Question, Mr. Speaker.

Mr. Erroll

Yes. Shaving requisites are taxed at 30 per cent. because they fall into the appropriate group. Cutlery is taxed at 15 per cent. for the same reason that that also falls into the appropriate group. I do not think there is any danger of cutlery being used in place of razors for cutting the bristle's off my hon. Friend's face. As this is my hon. Friend's 199th Question, I should like to wish him a merry Easter and a rest from his labours.

Mr. H. Wilson

Is the hon. Gentleman aware that after his 199th Question the hon. Member for Kidderminster (Mr. Nabarro) knows no more and is no wiser than when he started?

Mr. Nabarro

My 200th is Question No. 75 on the Order Paper today.

4 and 5. Mr. Moss

asked the Chancellor of the Exchequer (1) whether, in view of the protection against head injury afforded to motorists who wear anti-shock felt caps or hats, he will modify Customs and Excise Notice No. 78, so that such caps and hats are ranked with safety helmets and released from Purchase Tax;

(2) why anti-shock felt caps or hats are distinguished from safety helmets in Customs and Excise Notice No. 78.

Mr. Erroll

These caps are clearly outside the present exemption, which is for helmets. I cannot comment at this time on the hon. Member's proposal that the law should be amended.

Mr. Moss

Is the Minister aware that it is not really a question of the tax itself, which is only 5 per cent., but the fact that motorists will be safe from injury to the head if these caps and hats are worn? The point, therefore, is that they should be treated on the same basis from that point of view as helmets. Is the hon. Gentleman aware that Section 42 of the Road Traffic Act, 1956, defines helmets as any form of protective headdress? Will the hon. Gentleman please look into this matter, because this would be a great asset to road safety?

Mr. Erroll

I am aware of the inspiration which lies behind the hon. Gentleman's Questions and the sincerity of the points which he puts. I do not think that the very small imposition of tax is likely to be a deterrent to buying these felt caps or hats, which are quite different from helmets as defined in the Purchase Tax Schedule.