HL Deb 23 July 1980 vol 412 cc444-6

5.49 p.m.

Lord MOW BRAY and STOURTON rose to move, That the draft order laid before the House on 9th July be approved.

The noble Lord said: My Lords, I beg to move that the Compulsory Acquisition by Public Authorities (Compensation) (Revocation) Order 1980 be approved. This revocation order is simply a minor consequence of the Government's decision to repeal the Community Land Act. Under the Community Land Scheme, local authorities and certain other public bodies acquired land at a price net of the vendor's liability to Development Land Tax. This was part of arrangements designed to lead eventually to authorities acquiring all land for relevant development at a price net of all development gain—in effect a 100 per cent. local tax on such gain.

The ending of the Community Land Scheme removes the rationale for these arrangements, and they will cease to have effect after 5th August this year. Development land tax will become an ordinary tax on development gains collected wholly by the Exchequer. The main legislative provisions which established these arrangements were in the Development Land Tax Act which, along with the Community Land Act itself, provided the legislative framework for the Community Land Scheme. The relevant provisions of the Development Land Tax Act are being repealed, with effect from 6th August, in the current Finance Bill.

The Development Land Tax Act, however, only covered cases where public authorities were acquiring land from private vendors and other bodies who were liable to the tax. Special arrangements had to be made for transactions between tax-exempt bodies, so that any net-of-tax advantage was passed on to the final acquiring authority. This was done by means of an order under Section 26 of the Community Land Act, which changed the normal rules for assessing compensation in such cases. This revocation order will simply restore the compensation rules to those which operated before the Community Land Scheme was introduced. The original 1976 order would fall in any event when the Community Land Act is repealed. But it is necessary to revoke it now to synchronise with the Finance Bill. My Lords, I beg to move.

Moved, That the draft order laid before the House on 9th July, be approved.—(Lord Mowbray and Stourton.)

Lord PONSONBY of SHULBREDE

My Lords, may I thank the noble Lord for explaining the order. I am sure your Lordships will realise the necessity for the order in view of the repeal of the Com- munity Land Act. This is not something with which we agree, but I am sure the House will give approval to the order.

On Question, Motion agreed to.