§ Mr. Terry Davis
To ask the Chancellor of the Exchequer which departmental Ministers and officials represented the Government in the discussions with British Aerospace on the applicability of section 768 of the Income and Corporation Taxes Act 1988 to proposals to be made by British Aerospace following their acquisition of Rover Group.
§ Mr. Lilley
[holding answer 18 December 1989]: Discussions leading up to the exchange of correspondence of 8 July 1988 between Inland Revenue and British Aerospace's advisers—which has been placed in the Library—were concerned with explaining how the Revenue approaches the law in this area and its possible application to possible changes in Rover Group's trade. The procedural arrangements for conveying the Revenue's formal views on any such changes were also discussed. The discussions were between British Aerospace, its advisers and the Inland Revenue. Officials from the Department of Trade and Industry and their advisers were also present. Treasury Ministers were aware that the Inland Revenue were having these discussions, but no Ministers were 193W present at them. As the exchange of correspondence makes clear, the guiding principle throughout was that the tax treatment of anything concerning the Rover acquisition must be consistent with the law and the treatment of other taxpayers in comparable circumstances.
Discussions since the sale of Rover Group concerning British Aerospace's tax liabilities under the law are a matter between the company, its advisers and the Inland Revenue. It would not be in keeping with the strict rules of tax confidentiality for Ministers or other departmental officials to be involved in any such discussions.
It is not the practice of this Government or their predecessors to name officials.