§ Mr. Nicholas Edwardsasked the Chancellor of the Exchequer whether he will indicate his intentions as regards the rate of first-year allowance in respect of capital expenditure incurred after 19th July, 1971, on the provision of tractors and other mobile machinery and plant for use in agriculture, forestry and the service industries in development areas and Northern Ireland.
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§ Mr. Patrick JenkinYes. My right hon. Friend announced on 19th July his intention to include legislation in next year's Finance Bill whose effect will be that capital expenditure incurred after that date on new immobile machinery and plant for use in a development area or in Northern Ireland will qualify for the free depreciation (100 per cent. first-year) allowance, irrespective of the nature of the trade in which the equipment is used. The present statutory definition of mobile machinery and plant excludes certain equipment which in normal use has only limited mobility, but the exclusion is framed by reference to equipment used in those trades to which the 100 per cent. first-year allowance applied before 19th July. My right hon. Friend will propose in the legislation to exclude from the definition of mobile equipment machinery or plant which is suitable for use only
- (i) in or about premises used for the purposes of a trade
- (ii) on agricultural, forestry or amenity land
- (iii) at a source of mineral deposits, Or
- (iv) at or about a building or civil engineering site.
Expenditure incurred after 19th July, 1971, on such machinery or plant, if it is new and is for use in a development area or in Northern Ireland, will accordingly qualify for the 100 per cent. allowance.
General-purpose farm tractors and farm trailers such as are commonly used for the conveyance of goods away from the area of the farm would not be eligible for the 100 per cent. allowance, but agricultural equipment which is suitable for use only on the land and whose normal movement is simply from one part of the farm to another, would be eligible.