HC Deb 03 August 1961 vol 645 cc1638-9
28. Mr. Ridley

asked the Chancellor of the Exchequer whether he will disallow the charging against company taxation of expenses on country houses, sporting properties and leases, boxes at racecourses, and similar items.

Sir E. Boyle

My right hon. and learned Friend will bear my hon. Friend's suggestion in mind when he comes to review the whole question of expenditure on business entertaining before the next Budget.

Mr. Ridley

Is my hon. Friend aware that there is absolutely no justification for this sort of thing? There is no need, surely, for my right hon. and learned Friend to wait. Could not he simply make a statement to this effect immediately and satisfy many people who are disturbed about this?

Sir E. Boyle

I have considerable sympathy with my hon. Friend on this. Let me make a brief statement now. To the extent that directors and senior employees derive personal benefit from facilities of this sort provided by their companies, they are liable to tax on the costs to the company of providing them with the benefit. So far as they enjoy such facilities in the process of business entertaining, I think that my right hon. and learned Friend indicated sympathy with my hon. Friend's point of view in his Budget speech when he referred to the unhealthy excess in some business entertaining, and, as I have replied this afternoon, he is engaged at this moment in a review of this whole question.

Mr. Jay

If the right hon. and learned Gentleman does not have to wait until next year to raise taxes by £200 million, why does he have to wait until next year to do something about this?

Sir E. Boyle

This is exactly the kind of subject where it is very undesirable to bring in precise fresh detailed legislation before one has examined all the aspects pretty thoroughly.

Mr. Kershaw

Will my hon. Friend bear in mind that this matter is undoubtedly a scandal and ought to be stopped?

Sir E. Boyle

I have already referred to my right hon. and learned Friend's Budget speech. I suggest that perhaps my hon. Friend also recalls what I said to the hon. Member for Sowerby (Mr. Houghton) on an Amendment to the Finance Bill, that my right hon. and learned Friend has no sympathy with those who regard this subject as something beyond the competence of this House. This is certainly a subject which my right hon. and learned Friend takes most seriously.

Mr. H. Wilson

The hon. Gentleman says that the Chancellor needs time to study this difficult problem. As we gave him all the evidence he needed on this on the Second Reading of the Finance Bill on 9th May, 1956, together with detailed proposals of how to deal with it—I will give the hon. Gentleman the column reference if he wishes—why is it that after five years we are getting only statements that the Chancellor does not feel any sympathy for this racket?

Sir E. Boyle

It is not a matter only of the need for time to consider the problem, but time to consider the precise terms of any legislation which may be necessary.