§ Mr. Ian Lloydasked the Chancellor of the Exchequer whether it is the policy of Her Majesty's Government that professional firms should be able to pass on that proportion of Selective Employment Tax which they are unable to offset by higher productivity; and what steps he is taking to enable the legal profession to do so by appropriate modification of statutorily controlled charges.
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§ Mr. TaverneThe Government expect all employers who pay S.E.T. without refund, including professional firms, to absorb as much of the tax as possible. To the extent that this cannot be done, some increase in charges may be justified, in accordance with the criteria for price increases in the White Paper "Productivity, Prices and Incomes Policy in 1968 and 1969" (Cmnd. 3590).
So far as solicitor's charges are concerned, the Government have accepted the proposal made by the National Board for Prices and Incomes in their Report on the Remuneration of Solicitors (Cmnd. 3529) that there should be a standing reference under section 3 of the Prices and Incomes Act 1966 and any relevant factor can be taken into account in such a review. In the meantime, my right hon. and Noble Friend the Lord Chancellor has begun discussions with the Law Society on detailed proposals for implementing the Board's recommendations for certain alterations in solicitors' charges.