HC Deb 10 July 1975 vol 895 cc728-9
11. Mr. Brittan

asked the Chancellor of the Exchequer whether he is satisfied with the law relating to the treatment for tax purposes of business expenses.

Mr. Robert Sheldon

I should be grateful if the hon. Gentleman would tell me what aspects of the tax law he has in mind, and I shall gladly look into them.

Mr. Brittan

Is it not a wholly unacceptable anomaly that unions have been able to obtain tax-free allowances in respect of meals taken by their members while away on their jobs while the self-employed have to pay tax on them? Is it not an even more unacceptable anomaly that trade union officials such as Mr. Scargill can be provided with large Volvo cars and pay no tax on the benefit which they receive?

Mr. Sheldon

The Government are looking into the taxation of certain benefits in kind. The hon. Gentleman will be aware of the incredible anomalies which exist throughout the whole of the private sector whereby large benefits are being obtained and the due rate of tax is not paid on them.

Mr. Tinn

Does my hon. Friend agree that it is a far more grievous anomaly that ordinary working people are not allowed to charge against their tax the cost of travel to work, in contrast to self-employed and business people generally who are allowed tax concessions?

Mr. Sheldon

This has been looked at frequently in the past. A concession of that kind has not been possible because of the amount that it would involve and the repercussions which would result. We are aware of the anomalies involved in the taxation of benefits in kind, some of which my hon. Friend referred to, and the matter is being examined at present.

Sir G. Howe

Does the Minister accept that one of the most powerful pressures towards the achievement of legitimate expenses for tax purposes arises from the extremely high and recently increased marginal rates of taxation? As long as there is a Government which is obsessed by the pursuit of egalitarianism at all times and in all circumstances, it will be impossible to restore sanity to the tax system and promote economic growth.

Mr. Sheldon

The right hon. and learned Gentleman is entitled to his point of view. But these problems were with us long before the rates of tax attained their current levels. I suspect that they will remain with us irrespective of what happens to the levels of taxation.