HC Deb 07 March 1967 vol 742 cc1238-9
12. Mr. Judd

asked the Chancellor of of the Exchequer what plans he has to exempt registered charities from Purchase Tax on Christmas cards.

19. Mr. Rowland

asked the Chancellor of the Exchequer whether in order to enable printing contracts to be placed in good time for next Christmas he will reduce Purchase Tax now levied on Christmas cards sold by charitable organisations.

Mr. MacDermot

I would refer my hon. Friends to the reply given to the hon. Member for Belfast, South (Mr. Pounder) on 21st February, to the effect that such a reduction would result in unfair competition with other Christmas cards which have to bear the tax.—[Vol. 741, c. 241.]

Mr. Judd

Does not my hon. and learned Friend agree that, in view of the important work done by charities in promoting a sense of social responsibility and in practical social work, there is a need for an urgent review of this tax, and its elimination altogether?

Mr. MacDermot

For the reason that I have given I do not think that this would be acceptable. Where charities enter into trading activities, most people would expect them to trade on an equal basis with those with whom they compete. Their profits are free of tax.

Mr. Rowland

Instead of protecting commercial Christmas card operators, would it not be better if the Treasury reviewed this matter in the light of the economic squeeze which has made life very hard for charities for the last few months?

Mr. MacDermot

I do not think that charities are suffering in this way. It is not a matter of protecting other traders, but protecting the Revenue.

Mr. John Hall

In view of the fact that the Chancellor told me previously that he has received no representations from manufacturers or retailers protesting against the system which gave preference to charities, will not he reconsider the question and at least consider repaying to charities, in the form of a grant, the difference between the tax as it now stands and the tax that he proposes to impose?

Mr. MacDermot

The principle involved is an important one. It cannot be confined to Christmas cards. If this concession were to be made there are many other fields in which charities could turn to trade, and trade on terms which meant that they did not compete fairly. The suggestion that the hon. Member is making would mean concealing what would still exist—discrimination in favour of charities.