§ Prospects for the gilt-edged market are much better than they were this time last year, primarily because the public sector as a whole will be repaying debt. I propose to fortify this better prospect by a Capital Gains Tax concession in respect of gilt-edged securities. The gilt-edged market is unique in that the Government are once the issuer of the securities and a large scale dealer in the market; and because the way in which the market is managed has consequences for the management of the whole economy.
§ I therefore propose that from 3.30 p.m. today disposals of marketable securities issued by the Government, and marketable securities issued by public corporations and guaranteed by the Government, which are to all intents and purposes gilt-edged securities, will not be chargable to longterm Capital Gains Tax or, in the case of long-term gains of companies, Corporation Tax. As a corollary, losses on Government and Government-guaranteed securities will not be allowable for capital gains purposes. Short-term gains on these securities, including gains realised within twelve months by companies, will continue to be taxable as at present. A list of the securities which will qualify for exemption appears in the Budget Report. This measure should make gilt-edged more attractive to investors and will encourage a more active market in gilts—a necessary condition for a successful selling policy.