§ 15. Mr. Tilneyasked the Chancellor of the Exchequer whether, in the interests of exports, he will seek to relieve export merchants of Selective Employment Tax in the audited ratio of the volume of 1019 export sales to that of any sales in the home market.
§ Mr. TilneyDo not the Government realise that only in a very few cases does the manufacturer sell his product overseas? It is done by export merchants. Why do the Government think that to make something is good but that to sell or maintain it overseas is apparently bad?
§ Mr. TaverneThe Government do not think that at all. One of the reasons why the hon. Gentleman's request cannot be complied with is that it would, if supported by some special concession to services ancillary to the export of goods, be contrary to some of our international obligations.
§ Mr. MacDonaldIf my hon. and learned Friend cannot agree to the suggestion in the Question, will he consider the recommendations made by the Kleinwort Committee in respect of relief of this tax to export houses and merchant banks in the City in connection with exports?
§ Mr. TaverneAnother difficulty is that many services are concerned with exports. If we gave a refund or some other concession to all services connected with exports, as the Bland Committee pointed out, only the distributive trade would be left bearing the S.E.T.
§ Mr. Iain MacleodDoes the hon. and learned Gentleman really need the Reddaway inquiry to confirm the belief that the work of export merchants is vastly more important than a whole range of manufacturing? Will he not be better employed in planning to get rid now of the S.E.T. and to replace it with one of the variants of a sales or value-added tax?
§ Mr. TaverneThe importance of the work of these houses is acknowledged, but they have had a considerable gain through devaluation.