HC Deb 30 June 1964 vol 697 cc1122-3
14. Mr. W. Hamilton

asked the Chancellor of the Exchequer to what extent it has been the policy of Her Majesty's Government to pay compensation when incomes which are exempt from tax by ancient Statute cease to be so exempt.

Mr. Boyd-Carpenter

I know of no such case.

Mr. Hamilton

Has the right hon. Gentleman read the speech by the Financial Secretary in a debate on tax-free toll bridges on 10th June? Is the right hon. Gentleman aware that his hon. Friend implied that, if taxation is imposed on something which by ancient Statute is now tax-free, then compensation ought to be paid? If that is accepted as a principle by the Financial Secretary and not by the Government, then surely the Financial Secretary should have some plain speaking and education from the right hon. Gentleman. Can the right hon. Gentleman say whether, if that is to be a principle, he will apply it to sweets and pots and pans, all of which have had tax imposed on them whereas they were previously tax-free?

Mr. Boyd-Carpenter

I think the hon. Gentleman misunderstood my Answer. What my hon. Friend the Financial Secretary said in his excellent speech—and I am happy to repeat it—is that, if the Government of the day enter into an agreement with a citizen to do something on particular terms, it is quite wrong for a subsequent Government to repudiate that agreement because it seems inconvenient.

Mr. Hamilton

Cannot the right hon. Gentleman accept as a principle that any Government at any time can repeal ancient Statutes, particularly when those ancient Statutes give tax-free bonuses—in many cases, to wealthy people?

Mr. Boyd-Carpenter

One even more fundamental principle is that Governments keep their word.