HC Deb 22 May 1968 vol 765 cc524-6
24. Mr. Buchanan-Smith

asked the Secretary of State for Scotland what representations he has received regarding the division of Scotland into areas where certain hotels receive refund of the Selective Employment Tax and where others do not; and if he will make a statement.

25. Mr. Wolrige-Gordon

asked the Secretary of State for Scotland what further representations he has received from outside bodies about the discrimination of the Selective Employment Tax on the hotels in the eastern part of the country; and what reply he has sent.

Mr. Ross

I have received 30 representations, of which 16 were from bodies in the east of Scotland, including East Lothian, Fife, Kincardine and Roxburgh County Councils. In my replies I have said that the selection of areas listed in Schedule 17 of the Finance Bill broadly achieves the object for which the concession was designed and that there would be an opportunity for the matter to be discussed in detail at the Committee stage of the Finance Bill.

Mr. Buchanan-Smith

Is the right hon. Gentleman aware that most of us will be unable to discuss this matter in Committee on the Finance Bill? Is it not clear, from the weight of representation that has been made-against this iniquitous and arbitrary distinction between areas of Scotland, that once again the Secretary of State is completely out of touch with the people of Scotland?

Mr. Ross

I have been very interested indeed in the desire of certain towns in Scotland to be designated as rural towns, particularly since hitherto many people have thought themselves to be veritable centres of metropolitan thought in Scotland. I assure the hon. Gentleman that this is a matter which will be further discussed on the Finance Bill; and that is the time for the subject to be debated.

Mr. Wolrige-Gordon

Is the right hon. Gentleman aware that he is far too ready to practise discrimination, that discrimination against hotels in my constituency and in other parts of the country is totally unjust and that these hotels need the same chance as every other hotel in the country to contribute to the growing tourist industry?

Mr. Ross

The hon. Gentleman raises two questions; first, that of tourist development and the need for incentives to aid tourism and, secondly, that of regional development and the need for help in particular areas. I remind him that his hon. Friends are constantly asking me to discriminate—for example, in favour of the Highland areas—and I suggest that we have gone a good deal beyond what has been sought in an endeavour to be of help. I sometimes wonder if we should have done it at all.

Mr. Steele

As the proposal is obviously designed to help hotels which are busy only seasonally, may I ask whether my right hon. Friend is aware that to set a line of this kind is bound to cause anomalies because of a certain amendment of rigidity caused by that line? Will he bear this in mind and perhaps formulate a system whereby hotels which are busy for only parts of the year and which at present fall on the wrong side of the line can be considered?

Mr. Ross

My hon. Friend will appreciate that: no matter where the line is drawn there will be anomalies. No matter how one discriminates, anomalies will occur between those who are within a scheme and those who are just left out. Whether or not this whole matter is serious enough to merit an amendment of the proposal is a matter for consideration in further stages of the Bill.

Mr. Younger

Is the right hon. Gentleman not aware that it is bitterly unfair on hotels competing in the same market as other hotels in these areas which have to face the same problems and markets and put up their prices? Will he reconsider this? Will he tell us who drew this line, he or the Minister of Labour in London?

Mr. Ross

The hon. Member knows well that the decision was a Government decision and that is how it is properly to be expressed. As to competing in the same market, that is not always true— [An HON. MEMBER: "Of course it is."] —no, it is not always true. For instance, in Girvan and in Ayr there is very considerable difference.

Mr. G. Campbell

Do not the words used by the Secretary of State, saying that wherever the line is drawn anomalies would be created, confirm again that there is only one thing to be done with this tax and that is to abolish it?

Mr. Ross

If that were done it would have to be replaced by another tax and there would be a bigger outcry than ever.

Mr. Buchanan-Smith

On a point of order. In view of the unsatisfactory nature of the reply, I beg to give notice that I shall raise the matter on the Adjournment.