§ 78. Sir H. Williams
asked the Financial Secretary to the Treasury why, in the recent agreement between the Commissioners of Customs and Excise and the 105W Clothing Federation, those manufacturers who have more than 250 live accounts with ordinary retailers are treated more favourably in respect of Purchase Tax than those who have fewer than 250 such accounts; and what statutory authority there is for this discrimination.
§ Mr. Boyd-Carpenter
The statutory authority is Section 21, Finance (No. 2) Act, 1940, which provides for tax assessment by reference to the price which the goods would fetch on a sale by wholesale to a retail trader. The arrangements in question were recently agreed with the clothing associations to facilitate initial classification of manufacturers who, when selling direct to retailers, may be considered for this purpose as selling at the wholesale price-level. The figure mentioned is one of several tests applied in this connection as a general working rule; but it does not preclude similar treatment for other cases on special consideration.
As my hon. Friend will know, this and other matters relating to Purchase Tax valuation will be reviewed, by the committee which has recently been appointed by my right hon. Friend.