HC Deb 02 June 1964 vol 695 cc998-9

Question proposed, That the Clause stand part of the Bill.

Mr. Douglas Houghton (Sowerby)

This Clause is worth a few minutes' consideration. It proposes to increase the excise duty on light oils produced in the United Kingdom and to bring up the excise duty on home-produced light oils to the level of taxation imposed on imported oils of a similar kind.

Although the Clause is very close indeed to the one that we have just considered—raising the Tobacco Duty—and comes very close to it in the Bill—the two things were a long way apart in the Chancellor's Budget statement. He mentioned the proposal in Clause 5 in the first minute of his Budget speech and the proposal in Clause 4 in the last minute of his speech. That illustrates the wide difference of effect and of the public interest between them.

The amount of additional duty raised by the Clause is £1½ million this year and £71½ million in a full year, which is very small beer compared with most other taxes in Clauses in the Bill. The interest in this Clause to me is the calm with which the Committee is taking the implementation of the Convention of the Seven, our E.F.T.A. partners. I suspect that had we been doing this by Convention of the Six, the Committee would have been very bitterly occupied in a debate on whether the supremacy of Parliament had been lost.

I do not want to touch any exposed nerves on either side of the Committee, but we are taking this very calmly—yet it is exactly the same in principle. We have reached agreement in E.F.T.A. to abolish the Excise preference to home-produced light oil, so we throw it out of the window. The truth of the matter is that we would be no more free to reject Clause 5 and remain in E.F.T.A. than we would be able to reject any other proposal and remain as a member of the Six.

I am always fascinated by contradictions, and this, I suspect, is one of them. However, this is what it is all about. It is interesting to note that this is in fulfilment of our obligations to our E.F.T.A. partners and that we accept the fulfilment of those obligations like men, taking it calmly, with a stiff upper lip and all that, without feeling in any degree that we have lost the sovereignty of Parliament. That is an extraordinary position. It is one which I feel very happy about, because I think that it augurs well for the future, whatever it may be. That is all that I have to say on this Clause.

Mr. Maurice Macmillan

I have very little to add to what the hon. Member for Sowerby (Mr. Houghton) has said. This is purely a consequential Clause to meet our obligations to our E.F.T.A. partners to abolish the preference. The only point of detail which I think the hon. Gentleman did not mention was the reason for having to put the increase on the home duty rather than to do it the other way round. That, of course, is due to the impossibility of segregating imported oils of different origins. It is not physically possible to separate in their passage through our industrial system oils coming from E.F.T.A. or from other parts of the world, and, therefore, the only practical method of abolishing the preference is by raising the duty on the home-produced oils.

Question put and agreed to.

Clause ordered to stand part of the Bill.