HC Deb 18 May 1965 vol 712 cc1207-8
Q6. Mr. Fisher

asked the Prime Minister whether, in view of Her Majesty's Government's decision to limit tax-chargeable entertainment expenses to foreign buyers, he will introduce legislation to include for tax the £4,000 per annum of the Prime Minister's official salary which has hitherto been tax free.

The Prime Minister

No, Sir.

Mr. Fisher

What is the difference in principle between business and Government entertainment? As the right hon. Gentleman has a call on the Government Hospitality Fund for official entertainment of visitors from overseas, why should not his extra £4,000 a year be subject to tax like anyone else's expense account?

The Prime Minister

First, I must point out to the hon. Gentleman that there is a difference between Government and business. Perhaps what was wrong in the past was that we got too much incursion by business into Government.

Secondly, there is no change in the position that has prevailed for many years, including the period when the hon. Gentleman himself was a member of the Government and did not feel disposed to raise the matter then.

Thirdly, the Lawrence Committee, appointed by the last Government, recommended an increase in the amount and we have rejected that advice.

Fourthly, the difference between this allowance, which was taken by every successive Conservative Minister as far as I know, and that of a business firm is simply that where a firm decides that entertainment is necessary the value of that entertainment is paid for by the firm; it is not taxed addi- tionally in respect of the individual responsible for it. There is no difference at all between the two cases.

Mr. William Clark

If the right hon. Gentleman will not restrict Government entertainment will he consider restricting the entertainment carried on by nationalised industries?

The Prime Minister

I am not sure what the hon. Gentleman means by restricting entertainment by the Government. I have just given the figures for entertainment by the Government Hospitality Fund under the previous Government and this one. The figures are very similar. If the hon. Gentleman wants to raise the question of entertainment by the nationalised industries he can do so at the proper time. It does not arise now because it does not come out of money voted to the Prime Minister.