§ 3.7 p.m.
§ LORD AIREDALEMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
§ [The Question was as follows:
§ To ask Her Majesty's Government whether, in the interests of road safety, they will remove the purchase tax charged on safety belts supplied fitted to new cars, which is not charged on safety belts bought separately.]
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF HOUSING AND LOCAL GOVERNMENT (EARL JELLICOE)The position, my Lords, is that purchase tax would be charged if the safety belts supplied in a new car were fitted in the factory, before the point at which the legal liability to tax arises on the completed car. But British manufacturers are designing their cars so that safety belts can be properly fitted at a later stage, in order to accord with the customer's choice. In these latter circumstances, no liability to tax on the safety belts arises.
§ LORD AIREDALEMy Lords, I am very much obliged to the noble Earl for that helpful Answer.
§ LORD SHEPHERDMy Lords, can the noble Earl give an explanation why a person who fits a safety belt to his vehicle and has to go through adapting his own car must pay the purchase tax? I gather from his reply that that is the position. Is that true?
§ LORD DERWENTMy Lords, may I ask my noble friend whether he is quite sure he is correct?—because, as I 1122 understand it, if the anchorage of a safety belt, which is really part of the whole safety device, is incorporated in the car by the manufacturer before delivery, then purchase tax is charged on the anchorage but is not charged on the safety belt. If, on the other hand, a safety belt is provided with the car and the anchorage is fitted after delivery, then, as I understand it, no purchase tax is charged either on the anchorage or on the belt. Can my noble friend think of anything sillier than that?
EARL JELLICOEMy Lords, I should have thought that the answer was that I certainly could think of sillier things. But I understand that when manufacturers fit the anchorage in the factory they absorb the cost in their general production costs.
THE EARL OF ARRANMy Lords, will Her Majesty's Government consider the question of making safety belts compulsory in motor vehicles?
§ VISCOUNT ALEXANDER OF HILLSBOROUGHFree of tax.
EARL JELLICOEThat is another question, my Lords, and would really better fall for answer by my noble friend Lord Chesham, if my noble friend Lord Arran would like to put it to him on another day.
§ LORD STONHAMMy Lords, can the noble Earl say why there are different rates of purchase tax for the belt and the anchorage?
§ LORD TAYLORMy Lords, is not the anchorage simply two holes; and how can one tax two holes?