§ Mr. SainsburyI beg to move Amendment No. 247, in page 26, line 30 after 'minerals' add
'or the consideration includes an amount in anticipation of the grant of planning permission authorising material development consisting of the winning or working of minerals and such planning permission is granted within three years of the date of disposal'.
§ Mr. SpeakerWith this we may take the following amendments:
- No. 248, in page 27, line 5 leave out 'one half' and insert 'one quarter'.
- No. 250, in page 28, line 3 at end insert—
'(c) the construction of buildings to be used otherwise than as a dwellinghouse for the welfare of workers employed on the operations'.
§ Mr. SainsburyThe amendment is an attempt to act on a memorandum of observations on the clause from the Royal Institution of Chartered Surveyors. The institution said:
We welcome the proposal to provide relief parallel to that provided under Development Gains Tax in respect of deemed disposals under Clause 17(1), and a partial measure of relief under Clause 17(3) for other disposals with planning permission for the winning or working of minerals, again similar to that under 1870 Development Gains Tax. However, we are concerned that the latter relief does not appear to be given in respect of a disposal where there is no planning permission.We point out that it is not unusual for mineral operators to lease land for mineral extraction before seeking planning permission. It would in our view be inequitable for such a lease to be treated differently for DLT purposes from a lease granted following planning permission. We therefore recommend that, where there is a lease to a bona fide mineral operator, the relief in Clause 17(3) should apply".I hope that the Minister will agree that the amendment would effectively implement what the institution suggests.I shall not press Amendment No. 248.
I hope that the Minister can accept Amendment No. 250 or say that it is unnecessary because that aspect of mineral development is already covered.
§ Mr. Denzil DaviesAmendment No. 247 seeks to give relief on the disposal of land where there are mineral rights, even when planning permission has not been granted. But if planning permission is granted within three years of the disposal, relief would be granted back to the point of the disposal. I cannot accept that amendment.
The objection to the amendment is that a test depending upon a subsequent grant of planning permission makes the vendor's liability to tax hang on a future event which is outside his control. Therefore, the vendor waits three years and if planning permission is granted at the end of that period he gets relief from taxation. That imposes obligations on the purchaser. No doubt indemnities and conditions would have to be imposed in contracts to see that the purchaser used his best endeavours to obtain planning permission. If he does not try hard enough, can the vendor sue him for the loss of relief he has suffered? There are all sorts of difficult ramifications to trying to give tax relief in respect of something that happens in the future when that event is outside the control of the person claiming the relief.
Amendment No. 250 is unnecessary, as the developer will be able to defer payment of DLT under Clause 19, which covers development consisting of the construction of buildings for use otherwise than as dwelling houses for the welfare of workers employed in a trade. It would 1871 be unfair to give complete exemption to the mining industry.
I hope that I have given the hon. Gentleman sufficient assurance.
§ Mr. SainsburyI am grateful to the Minister for his assurance on Amendment No. 250 and his brave words about the mining industry—brave coming from an hon. Member representing a seat in the Minister's part of the world.
I appreciate what the hon. Gentleman said about Amendment No. 247. I see that there are difficulties, but as the matter appears to be a cause of general concern to the Royal Institution of Chartered Surveyors, perhaps he could have it discussed and dealt with in a later Finance Bill, if necessary.
§ Amendment negatived.