§ Mr. Heddleasked the Chancellor of the Exchequer (1) what information is available in published form to members of the public requiring details of the industrial building allowances;
(2) whether he has any proposals to update leaflet CA2 issued by the Board of Inland Revenue entitled "Income Tax and Corporation Tax, Capital Allowances on Industrial Buildings" dated October 1972.
§ Mr. RidleyInformation about industrial building allowances is available in leaflet CA2 "Capital Allowances on Industrial Buildings", in the companion supplement CA2 (Supp) (1979) and in subsequent press releases and statements of practice issued by the Board of Inland Revenue. Leaflet CA2 will be further updated as circumstances dictate.
§ Mr. Heddleasked the Chancellor of the Exchequer (1) whether he will now amend the Capital Allowances Act 1968 to enable all buildings capable of generating employment on industrial or trading estates to qualify for industrial building allowance; and whether he will make a statement;
(2) whether he will extend the industrial building allowance to include those related directly to the Town and Country Planning Act use classes (a) class III, light industry, (b) class IV, general industry and (c) class X, warehouse distribution; and if he will make a statement.
§ Mr. RidleyI have noted my hon. Friend's suggestions. The scope and form of the present system of capital allowances will be considered as part of the Government's review of corporation tax following publication of the Green Paper—Cmnd. 8456.
§ Mr. Heddleasked the Chancellor of the Exchequer (1) whether he is satisfied with the take-up of industrial building allowances for small industrial workshops since the introduction of the scheme; and if he will make a statement;
(2) further to the statement by the Financial Secretary to the Treasury the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) on 17 November, Official Report, c. 262, what evidence his Department has received that in many areas there has been a complete take-up of the new small workshops.
§ Mr. RidleyThere has been a very encouraging response to the small industrial workshops scheme. Reports indicate that the take-up of new workshops is good, but that vacant units remain available for letting in some areas.
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§ Mr. Heddleasked the Chancellor of the Exchequer what evidence his Department has received which shows that most prospective tenants for nursery units are in the servicing sector and not entitled to industrial building allowances; and if he will make a statement.
§ Mr. RidleySome letters have been received, and my hon. Friend has made representations.
§ Mr. Heddleasked the Chancellor of the Exchequer if he will review the effect of the Finance Act 1980, under which a sports pavilion used by a trader for the welfare of his employees is treated as an industrial building for the purposes of industrial building allowance, as laid down by section 10 of the Capital Allowances Act 1968.
§ Mr. RidleyI have noted my hon. Friend's suggestion.
§ Mr. Heddleasked the Chancellor of the Exchequer if he will clarify what is meant in the Inland Revenue statement of practice SP4/80 dated 26 March 1980 in connection with industrial buildings allowances by the use of the word "several" in the phrase "several units in one estate" and the word "significantly" in the phrase "where relief available would be significantly lower on a strict application of the industrial building allowances rules"; and if he will make a statement.
§ Mr. RidleyThe statement of practice outlined a simplified system of administering capital allowances for estates of small industrial workshops constructed for separate letting to small businesses.
The final sentence of the statement, to which my hon. Friend's question relates, explained that this arrangement will not apply where, exceptionally, several units in one estate are let to the same or connected tenants, or where the estate is to a significant extent used for trades which do not attract industrial buildings allowance. In those circumstances, inspectors of taxes have to judge, on broad lines, on the facts of each individual case.
If my hon. Friend has any specific situation in mind, he may care to write to me about it.
§ Mr. Heddleasked the Chancellor of the Exchequer if he will list in the Official Report the major changes that have been made to the regulations governing industrial buildings allowances since 1968.
§ Mr. RidleyThe information is as follows
Rate of initial allowance increased to 30 per cent. (40 per cent. for development and intermediate areas and Northern Ireland) (Section 15 Finance Act 1970).Rate of initial allowance increased to 40 per cent. generally (Section 67 Finance Act 1972).Restriction of balancing allowances on sale of industrial buildings or structures subject to a subordinate interest (Section 69 of Finance Act 1972).Rate of initial allowance increased to 50 per cent. (Section 13 Finance Act 1975).Provision made for lessor and lessee of an industrial building to elect jointly that the grant of a lease of more than 50 years shall be treated as if it were a sale of the relevant interest from the lessor to the lessee (Section 37 Finance Act 1978.)Chapter 1, Part I Capital Allowance Act 1968 applied with modifications to qualifying hotels as if they were industrial buildings or structures (Section 38 and Schedules 6 Finance Act 1978).Rates of inital allowance increased (for limited periods) to 100 per cent. for the construction of
- (a) business buildings in enterprise zones (Section 74 and Schedule 13 Finance Act 1980)
- (b) small industrial workshops (Section 75 and Schedule 13 Finance Act 1980).
Rate of initial allowance increased to 75 per cent. (Section 73 Finance Act 1981).82WExtension and alteration of the rules relating to balancing adjustments (Sections 74–76 Finance Act 1981).