§ Mr. SayeedTo ask the Chancellor of the Exchequer what information he has on the extent to which the Governments of the Federal Republic of Germany and the Netherlands are contemplating following the example of the Danish and Swedish Governments in making special arrangements to reduce the burden of personal income tax and social security payments by or on behalf of their national seafarers so as to improve the competitive position of their merchant fleets in international trade; and if he has any plans to follow their example.
§ Mr. Norman LamontThe information that we have is as follows.
In 1988 the Netherlands Government distributed NF1 50 million (£12,500,000) to shipowners in proportion to the tax and social security payments that they remitted. The Netherlands Council of Ministers has approved a proposal to reduce by 35 per cent. the taxable income of seafarers employed by shipping companies whose ships fly the Netherlands flag. If this proposal is enacted, companies will from 1 January 1990 be entitled to withhold from seamen's wages the amount of tax and social security thus saved, while employees' after-tax position will remain unchanged.
I understand that the Parliament of the Federal Republic of Germany has agreed a Bill to establish a second German register for ships in international trade, the intention being that foreign seafarers not resident in the Federal Republic of Germany would be paid at rates agreed by the trade union of their native country.
382WOn the final part of the question, I cannot anticipate my right hon. Friend's Budget statement.