Lord Chelwoodasked Her Majesty's Government:
Whether they are aware that the abolition of tax incentives for planting (or replanting) and maintaining commercial woodlands is likely to result (especially in hurricane damaged areas) in woodlands being left to rot and turn to scrub as well as to a reduction in planting new woodlands of commercial significance; and
Whether it was their intention in abolishing the tax incentives to grow trees to encourage owners of commercial woodlands, especially those damaged by the hurricane, to turn them into pasture or arable land.
§ Baroness TrumpingtonI can assure my noble friend that it remains the policy of this Government to encourage the expansion of forestry. We have decided, however, that such encouragement should take the form of increased levels of grants than have hitherto been available, rather than an unsatisfactory combination of grants and tax reliefs. My noble friend will be aware that a new grant scheme, known as the Woodland Grant Scheme, is to be introduced on 5th April.
As far as the owners of storm damaged woodlands are concerned, they will be able to claim tax relief on the cost of clearing damage, under the existing tax 969WA rules, during a transitional period up to 5th April 1993. Tax relief for the cost of replanting will also continue during this transitional period, except where owners are receiving the increased grants under the new Woodland Grant Scheme.