Clause 33 (Hansard, 27 May 1970)

§ Mr. John Smith

I must apologise for making rather a footling electioneering point during the speech of the hon. Member for Sheffield, Heeley (Mr. Hooley), and I should like to make amends now by being fair and saying that far the greatest achievement of the Labour Government has been the abolition of the 2d. stamp duty on cheques. I go further and say that it is the most important achievement of any Labour Government since the abolition of the 1d. stamp duty on proxies by Sir Stafford Cripps in 1948.

I have made many speeches in this House—I am surprised on looking them up to find both how many there are and how good they are—on the subject of stamp duty. I hope that I may have played some part in getting rid of this ridiculous tax collected in the shape of 2d. on cheques. Having dipped this cautious toe into the icy waters of stamp duty reform, may I encourage the Government to plunge in and abolish some of the 6d. stamp duties as well.

I shall not weary the Committee by going through the arguments about stamp duty—they are all recorded in HANSARD —but it is a most obsolete and damaging tax. As we know, it is even older than the Inland Revenue, and it exists only because the levying of taxes then was not a very refined business and we did not have the Inland Revenue to do it. It is extremely uneven in its incidence. It is extremely complicated. There are 171 different cases of stamp duty, 350 separate relevant law cases, and there has been no consolidation of the duty for 78 years.

I know that in debates on Finance Bills Treasury spokesmen are very fond of producing reasons, drawn from other countries, why what they propose to do is sensible. They say that such-and-such a tax is much more onerous in Yugoslavia. I very much dislike this argument, but it so happens on this Clause that argument can be adduced from 1895 foreign countries. There is no stamp duty in good old Sweden, which is so much admired by the Labour Party. There is no stamp duty in China, but, on the other hand, there is stamp duty in South Africa.

I hope that having embarked on this course the Government will now look carefully at the question of stamp duty, and especially the cost of collection. It costs more to collect than any other tax. From that we can build up an argument that it is a counter-productive tax—that the costs in which it involves the community reduce the yield to the revenue of other taxes. I hope that whichever Government are returned on 18th June will, next year, take another bite at this obsolete and damaging tax, which is suited only to primitive communities.