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Third Schedule—(Purchase Tax—Intermediate Rate)

Volume 439: debated on Wednesday 9 July 1947

The text on this page has been created from Hansard archive content, it may contain typographical errors.

I beg to move, in page 61, line 37, at the end, to add:

"3. Mechanically propelled road vehicles constructed or adapted solely or mainly for the carriage of passengers, or having, to the rear of the drivers' seat, roofed accommodation lit by side windows and fitted with, or constructed or adapted for the fitting of, seating for passengers, being vehicles of a retail value of more than one thousand two hundred and eighty pounds the vehicle."

This Amendment is consequential.

It is not quite consequential, because it brings out a point which was raised last week, unless I have misread the Amendment.

It may be true that this matter was discussed last week. The Chancellor's Amendment was discussed with the three Amendments on Clause 8. Does the right hon. and gallant Gentleman wish to move his Amendment to the proposed Amendment.

I beg to move, as an Amendment to the proposed Amendment, in line 2, to leave out from "passengers," to "being," in line 4.

I do not think that we need keep the Committee very long on this matter because the main question has been discussed. The important words here are:
"…or having, to the rear of the driver's seat, roofed accommodation lit by side windows and fitted with, or constructed or adapted for the fitting of, seating. …"
I think that is a misprint. It must be that the comma is in the wrong place. I understand that this brings within the ambit of the duty utility vans in respect of which an Order was passed last week. I would like to ask whether I am right in that because, if so, it opens up an argument which I did not intend to repeat but which we put from this side of the Committee last week. We still feel that it is wrong in this case to bring utility vans within the scope of this provision. Primarily speaking, they are goods carrying vans. There is no question about that. They are limited as such. They are limited in the speed per hour that they legally are allowed to go. I understand, for example, and this is only one example. that they are prohibited from going into the Royal Parks. Therefore, as utility vehicles, they are considered to be goods carriers. If they have these side windows they are to come within the full scope of the tax. I understand that already a considerable export trade is being developed in utility vans which have side windows. The Financial Secretary the other night, in his disingenuous way, said that anybody could get out of paying the tax. He said that they need not have the windows and that that would take them out. That may or may not be true, but, of course, the foreigner who buys these vans would be rather surprised if he expected to have side windows and found they were not there, and that they had been taken out just because of the rather odd incidence of taxation in this country.

We have had all that before. I was not proposing to go into it again, but if the hon. Gentleman wants it he can have it. I was merely making the point that the foreigner would find it rather difficult if he had expected the utility van which he had ordered to have side windows and it turned up without side windows because they had been taken out—

The effect of the right hon. and gallant Gentleman's Amendment is to take out the windows.

It is not to take out the windows: it is to take utility vans out of the scope of this tax, windows or no windows. I hope that the right hon. Gentleman will see that it would not be advantageous, whatever may be said on the main issue, to have these words added to the Schedule. I apologise for moving the Amendment briefly but recently we had a long Debate on the subject.

I would like to ask a question and to put a point to the Financial Secretary before he replies. I have no doubt that I must be completely wrong, but, because I do not know why I am wrong, I feel I ought to ask. I went through this wording as carefully as I could and tried to find out what vehicle was intended. I asked a colleague of mine, who thought it meant a carriage, though I did not think that it meant that. I have read it through again two or three times to see if it is intended to relate entirely to utility carriages. Will my right hon. Friend say what the words do mean? Will they eliminate the ordinary passenger bus? What words will eliminate the five-seater Rolls Royce car. Do they include any vehicle having roofed accommodation lit by side windows, which certainly includes buses and cars constructed for the carriage of passengers, because, if so, it may well be argued that that would include the five-seater car? I suggest that some consideration of those words should be made, or the profession to which I have the honour to belong may make some profit from them.

Perhaps I may answer first the hon. Member for Oldham (Mr. Hale). He need not worry, because tram-cars, omnibuses, invalid carriages, perambulators and ambulances are exempt. They are exempted under the earlier Purchase Tax arrangements. I do not want to have to explain here how these things, like a jigsaw puzzle, dovetail one into the other—

This relates, I think, to Section 68 (b), which defines the articles not mentioned in the Seventh Schedule of the Act of 1942—walking sticks, mirrors, fur coats and so on There is a reference to the second column of the Schedule of this Act, but there is no second column to that Schedule, so we get no further. Could they not have been put on the Order Paper today?

Not only the 1942 Act, but also the 1940 Act, is concerned here, and my hon. Friend would have to refer to the Seventh Schedule in the one case, though I have forgotten the number of the Schedule in the other. However, if he will allow me, I will take him into the Library and show him the column of the Schedule in the Act where these vehicles are dealt with—the ambulances, perambulators, trolley-buses and the rest which are exempt.

This particular Amendment which stands in the name of my right hon. Friend, applies the law as it now exists for the ordinary passenger vehicle to the type of vehicle the Committee has just been discussing. It does no more and no less. It means that a Rolls Royce, for example, will come under the same regulations as the passenger-carrying vehicles we discussed the other night, when I defended a new Statutory Rule and Order. Then, we were dealing largely with shooting brakes, and, although a shooting brake does not normally cost the same amount as a Rolls Royce. Unless those words are inserted and this Amendment resisted, it would be possible for a Rolls Royce to be used as a utility vehicle and to escape being taxed at 66⅔ per cent. That is what we want to avoid. I gave an undertaking the other night on behalf of my right hon. Friend that, if it were found that vehicles which, quite properly, should not be caught up by the new Statutory Rule and Order were, in fact, caught up, I would arrange on a suitable occasion for another Statutory Rule and Order which would definitely exempt them by name. That undertaking still stands. We are now in touch with the trade organisations concerned, and are considering the question with them. If we find there are vehicles which should escape this tax, we shall be happy to ask the House to exempt them.

9.0 p.m.

I do not know whether the hon. Member for Oldham (Mr. Hale) feels that any light has been shed in consequence of the Financial Secretary's explanation. Personally, I should have thought it doubtful. I am sorry the hon. Gentleman was not with us the other night when we were discussing the Ways and Means Resolution. An intervention on his part would have been of great value, because we went, in some detail, into what this covered. We held that hearses were not passenger carrying vehicles, which I, personally, thought was wrong, because, not only do they carry a passenger, but one who travels in great comfort. We also discussed Black Marias, and such matters.

I would like to tell the Financial Secretary that, since that Debate took place, I find that farmers in my constituency are extremely disappointed that these utility vans have been brought within the ambit of this taxation. I do not want to repeat the Debate we had the other night, but it will be recalled by hon. Members who were present that a "shooting brake mentality" came over the Treasury Bench. The whole approach to the matter was, "Here is the squire going out for a day's shooting. Let us tax him. These brakes are immoral vehicles; let them be taxed." The Debate showed that the term "shooting brakes" was an inaccurate description of these utility vans, which are used, to a large extent, for agricultural purposes and for the carriage of goods.

I rise only to say that the Financial Secretary has really got us no further this evening than he did on the previous occasion. What did he say to the hon. Member for Oldham, who very properly said that he, as a lawyer, found difficulty in interpretating the words and that he thought they might be profitable to has profession? The Debate of the other night ran on similar lines. We said that there was obscurity. The Financial Secretary admitted that the matter was obscure and said, "There may be hard cases which may come within this definition. Give me this Clause which nobody understands, and, in due course, if some- thing emerges therefrom, we will try to put it right." That is an extraordinary method of legislation. It is the sort of hit and miss business which we have had ever since this Government came into office—fuel, food, fags and films. I would like to remind the right hon. Gentleman of what he said the other night. He said:
"As I said frankly in my opening speech, we have great difficulty in finding a definition. We shall possibly find, in spite of trying to choose words, that certain types of utility vehicles which it is desired to exempt will be caught up. If that is so, I have to tell the House that later on we will very willingly, after consultation with the trade association concerned, come to the House and ask it to agree to another Order which will let out the particular vehicles, which we are all agreed should not be covered by this Order."—[OFFICIAL REPORT, 2nd July, 1947; Vol. 439, c. 1470.]
What a magnificent example of lucidity in legislation. Was ever the cart more firmly placed before the horse?—"Let us pass a law. We do not know what it means, but, later on, we will have a look at it, and we will consult the trade association when it is all over, instead of adopting the normal procedure." It is usual for these discussions to take place beforehand. Little wonder that the nation is sliding down.

I would like to ask two questions on points which, up to now, have been rather obscure to me. Most of us, in one way or another, are interested in the countryside, and a considerable number of vehicles are used mainly for the carriage of goods but are occasionally used to carry passengers, although not very often. What I would like to know is precisely how, in view of the wording,

"solely or mainly"
one will define whether or not these utility vehicles are used for the purpose of carrying passengers. I can understand that in the case of a bus or a lorry, it is obvious. I can understand that if they have windows in them they come under the tax. But I think that those words,
"solely or mainly"
are rather obscure. If a shopkeeper in West Scotland, for instance, was delivering groceries and gave a lift to one or two passengers and charged them for the ride, would it be a utility van for the purpose of delivering goods? Apparently, it would depend on whether the van had side windows or not, among other things, possibly. Obviously, if it is used for the distribution of goods it is a utility van. I think we might be told what sort of ideas the Treasury have—presumably, they have some sort of ideas—as to what the word "mainly" means. The other question which is exercising my mind is how this sum of £1,280 is arrived at. I am sure the Treasury have a reason, but I do not understand how they arrive at these words:
"…a retail value of more than one thousand two hundred and eighty pounds."

I am sorry to interrupt the hon. Member, but I would point out that we are now discussing the Amendment to the Amendment which seeks to leave out certain words.

I apologise very sincerely for having strayed away from the Amendment. I will raise the point on a more suitable occasion when the Amendment has been disposed of. I thought, possibly, we might be covering the whole matter now. If we are not, I shall have to use my opportunity later.

Possibly the hon. Member is not aware that the Amendment on which he could have raised this point was discussed on Clause 8.

In view of the size of the Budget for which the Government are responsible in these days, I doubt whether it is worth while dragging in such a small element of taxation of this description, bearing in mind the small amount of money which it would bring to the Exchequer. In the circumstances of the time, when we are dealing with figures of vast magnitude, it is a pity to drag into the financial policy so small a matter as the revenue to be derived from the taxation of vehicles. During all these discussions on motor taxation, the firm of Rolls Royce is constantly brought in as an example of the highest possible level—

I must remind the hon. Member that he is going far beyond the scope of the Amendment.

I apologise. Other firms produce motor cars in this country as well as Rolls Royce, and Rolls Royce ought not to be made a sort of standard for comparison. The ordinary motor manufacturer, too, is concerned with this Amendment. I would like to state the case of one of the smaller and unpretentious manufacturers who receives a large order for cars to be sent overseas.

I am sorry to interrupt the hon. Member again, but the Committee is now discussing the Amendment moved by the right hon. and gallant Member for Gainsborough (Captain Crookshank).

Of course, if the right hon. and gallant Gentleman the Member for Gainsborough makes a suggestion to

Division No. 306.]


[9.12 p.m.

Adams, Richard (Balham)Davies, Harold (Leek)Irving, W. J
Adams, W. T. (Hammersmith, South)Davies, R. J. (Westhoughton)Isaacs, Rt. Hon, G A
Allen, A. C. (Bosworth)Davies, S. O (Merthyr)Janner, B.
Allen, Scholefield (Crewe)Deer, G.Jeger, G. (Winchester)
Alpass, J. Freitas, GeoffreyJeger, Dr. S W. (St. Pancras. S.E.)
Attewell, H. C.Delargy, H. JJohn, W.
Austin, H. LewisDiamond, J.Jones, D. T (Hartlepools)
Awbery, S. S.Dodds, N. NJones, Elwyn (Plaistow)
Ayles, W. H.Donovan, TJones, J. H. (Bolton)
Ayrton Gould, Mrs BDriberg, T. E. N.Jones, P. Asterley (Hitchin)
Baird, J.Dugdale, J (W. Bromwich)Keenan, W.
Balfour, A.Dumpleton, C. W.Kenyon, C.
Barnes, Rt. Hon A. JEde, Rt. Hon. J. C.Key, C. W.
Barstow, P G.Edwards, Rt. Hon Sir C. (Bedwellty)Kinghorn, Sqn.-Ldr. E.
Barton, C.Edwards, W. J. (Whitechapel)Kinley, J.
Battley, J. R.Evans, E. (Lowestoft)Kirby, B. V
Bechervaise, A. E.Evans, John (Ogmore)Lang, G.
Benson, G.Evans, S. N. (Wednesbury)Lavers, S.
Berry, H.Fairhurst, F.Lee, F. (Hulme)
Beswick, F.Farthing, W. JLeonard, W.
Bing, G. H CFletcher, E G M (Islington. E.)Leslie, J. R.
Binns, JFollick, M.Lindgren, G. S.
Blenkinsop, AFoot, M. MLipton, Lt.-Col M
Blyton, W. R.Forman, J. CLogan, D G
Bowden, Flg.-Offr. H. WFraser, T (Hamilton)Longden, F
Bowles, F. G (Nuneaton)Gaitskell, H. T. NLyne, A. W
Braddock, Mrs. E. M. (L'pl, Exch'ge)Gallacher, W.McAdam, W
Braddock, T. (Mitcham)George, Lady M Lloyd (Anglesey)McAllister, G
Brook, D. (Halifax)Gibbins, J.McEntee, V La T
Brooks, T. J. (Rothwell)Gilzean, AMcGhee, H G.
Brown, George (Belper)Glanville, J. E. (Consett)Mack, J. D
Brown, T. J. (Ince)Greenwood, Rt. Hon. A. (Wakefield)McKay, J. (Wallsend)
Bruce, Maj. D W TGreenwood, A. W J (Heywood)McKinlay, A S.
Buchanan, G.Grenfell, D RMaclean, N. (Govan)
Burden, T. W.Grey, C. F.McLeavy, F.
Burke, W A.Grierson, E.Macpherson, T (Romford)
Butler, H. W. (Hackney, S.)Griffiths, Rt. Hon. J. (Llanelly)Mallalieu, J. P. W
Callaghan, JamesGriffiths, W. D. (Moss Side)Mann, Mrs. J.
Carmichael, JamesGuest, Dr. L HadenManning, C. (Camberwell, N.)
Castle, Mrs B. AGunter, R. JManning, Mrs. L. (Epping)
Champion, A. JGuy, W. HMarquand, H. A
Chetwynd, G RHaire, John E (Wycombe)Marshall F (Brightside)
Cobb, F A.Hale, LeslieMathers, G
Cocks, F. S.Hall, W G.Medland, H. M
Coldrick, W.Hamilton, Lieut.-Col. RMiddleton, Mrs. L.
Collick, P.Hannan, W. (Maryhill)Millington, Wing-Comdr E, R
Collindridge, F.Hardy, E. A.Mitchison, G. R
Colman, Miss G. MHarrison, JMonslow, W
Comyns, Dr. L.Hastings, Dr. SomervilleMoody, A. S.
Cooper, Wing-Comdr GHenderson, A (Kingswinford)Morgan, Dr. H B
Corbet, Mrs. F. K. (Camb'well, N.W.)Henderson, Joseph (Ardwick)Morley, R.
Corlett, Dr. J.Hewitson, Capt. MMorris, P (Swansea, W.)
Corvedale, ViscountHobson, C. RMorrison, Rt. Hon H (Lewisham. E.)
Cove, W. GHolman, PMort, D L
Crawley, AHolmes, H. E (Hemswoth)Moyle, A.
Daggar, GHouse, GNally, W.
Daines, PHoy, J.Naylor, T. E
Dalton, Rt. Hon H.Hubbard, T.Nichol, Mrs M E (Bradford, N.)
Davies, Edward (Burslem)Hudson, J. H. (Ealing, W.)Nicholls, H R (Stratford)
Davies. Ernest (Enfield)Hughes, H. D (Wolverhampton. W) Noel-Baker. Rt. Hon P J (Derby)

the Committee, I bow at once, but I do suggest that this is a really silly tax to impose on a very useful vehicle, useful for the farming community and many people in the countryside. Above all, do not let us always refer to Rolls Royce cars as the best in this country. We produce other cars. We produce the Daimler. which is the father of all cars.

Question put, "That the word pro posed to be left out stand part of the proposed Amendment."

The Committee divided: Ayes. 280. Noes, 118.

O'Brien, T.Shawcross, Rt Hn. Sir H. (St. Helens)Ungoed-Thomas, L
Oldfield, W. HShurmer, PUsborne, Henry
Oliver, G HSilverman, J (Erdington)Vernon, Maj. W F.
Orbach, M.Silverman, S. S. (Nelson)Viant, S. P.
Paling, Rt. Hon. (Wilfred Wentworth)Simmons, C. J.Walkden, E.
Palmer, A M FSkeffington, A. M.Wallace, G. D. (Chislehurst)
Pargiter, G. A.Skinnard, F. W.Wallace, H. W. (Walthamstow, E.)
Parkin, B. T.Smith, H. N. (Nottingham, S.)Watkins, T. E.
Paton, J. (Norwich)Smith, S. H. (Hull, S.W.)Watson, W. M
Pearson, A.Sorensen, R. W.Webb, M. (Bradford, C.)
Peart, T. F.Soskice, Maj. Sir F.Weitzman, D.
Platts-Mills, J. F. F.Sparks, J. A.Wells, P. L. (Faversham)
Poole, Major Cecil (Lichfield)Stamford, W.Wells, W. T. (Walsall)
Porter E. (Warrington)Steele, T.West, D. G.
Pryde, D. J,Stewart, Michael (Fulham, E.)Westwood, Rt. Hon. J.
Pursey, Cmdr. HStrauss, G. R. (Lambeth, N.)White, H. (Derbyshire, N.E.)
Randall, H EStross, Dr. B.Whiteley, Rt. Hon. W
Ranger, JStubbs, A. E.Wilkins, W. A
Reeves, J.Sylvester, G. O.Willey, F T. (Sunderland)
Reid, T. (Swindon)Taylor, H. B. (Mansfield)Willey, O. G. (Cleveland)
Rhodes, H.Taylor, R. J. (Morpeth)Williams, D. J. (Neath)
Richards, R.Taylor, Dr. S. (Barnet)Williams, J. L. (Kelvingrove)
Ridealgh, Mrs. M.Thomas, D. E. (Aberdare)Williams, Rt Hon. T. (Don Valley)
Roberts, Goronwy (Caernarvonshire)Thomas, Ivor (Keighley)Williams, W R (Heston)
Robertson, J. J. (Berwick)Thomas, I. O. (Wrekin)Willis, E.
Rogers, G. H. R.Thomas, George (Cardiff)Wills, Mrs. E A
Ross, William (Kilmarnock)Thomson, Rt. Hn. G. R. (Ed'b'gh, E.)Wise, Major F. J
Royle, C.Thorneycroft, Harry (Clayton)Woodburn, A.
Scollan, T.Thurtle, ErnestWoods, G, S
Scott-Elliot, WTiffany, S.Yates, V. F.
Segal, Dr. S.Titterington, M. F.Young, Sir R. (Newton)
Shackleton, E A A.Tolley, L.Zilliacus, K
Sharp, GranvilleTornlinson, Rt. Hon. G
Shawcross, C. N. (Widnes)Turner-Samuels, M.TELLERS FOR THE AYES:
Mr'Snow and Mr. Popplewell.


Agnew, Cmdr P. G.Headlam, Lieut.-Col. Rt. Hon. Sir CRayner, Brig R
Amory, D. HeathcoatHinchingbrooke, ViscountReed, Sir S. (Aylesbury)
Assheton, Rt. Hon. R.Hollis, M. C.Roberts, H. (Handsworth)
Barlow, Sir J.Holmes, Sir J. Stanley (Harwich)Roberts, Maj. P. G. (Ecclesall)
Beamish, Maj. T. V. HHoward, Hon. A.Robinson, Wing-Comdr. Roland
Beechman, N. A.Hutchison, Lt.-Cm. Clark (E'b'rgh W.)Ropner, Col. L
Bennett, Sir P.Jeffreys, General Sir G.Ross, Sir R. D. (Londonderry)
Birch, NigelJennings, R.Sanderson, Sir F.
Boles, Lt.-Col. D. C. (Wells)Kendall, W. DScott, Lord W.
Bossom, A. C.Kerr, Sir J. GrahamShephard, S. (Newark,
Bowen, R.Lambert, Hon. G.Shepherd, W S- (Bucklow)
Boyd-Carpenter, J. A.Lancaster, Col. C. G.Smiles, Lt.-Col. Sir W
Braithwaite, Lt-Comdr. J. G.Legge-Bourke, Maj. E A HSmithers, Sir W
Bromley-Davenport, Lt.-Col. W.Linstead, H NSnadden, W. M.
Buchan-Hepbum, P G T.Lipson, D. LSpearman, A. C. M.
Butcher, H. WLloyd, Selwyn (Wirral)Stanley, Rt. Hon. 0.
Clarke, Col. R S.Lucas, Major Sir J.Stoddart-Scott, Col. M.
Clifton-Browne, Lt.-Col GLucas-Tooth. Sir H.Strauss, H. G. (English Universities)
Conant, Maj. R. J. E.Macdonald, Sir P. (I. of Wight)Sutcliffe, H.
Cooper-Key, E. M.Mackeson, Brig H R.Taylor, Vice-Adm. E. A. (P'dd't'n, S.)
Crookshank, Capt. Rt. Hon H. F. C.MacLeod, J.Thorneycroft, G. E. P. (Monmouth)
Crosthwaite-Eyre, Col. 0. E.Maitland, Comdr. J WThornton-Kemsley, C. N.
Crowder, Capt. John EManningham-Buller, R. EThorp, Lt.-Col. RAF
Cuthbert, W. N.Marlowe, A. A. H.Touche, G. C,
Digby, S. W.Marsden, Capt. A.Turton, R. H.
Dodds-Parker, A. D.Marshall S. H. (Sutton)Vane, WMF
Dower, Lt.-Col. A. V. G. (Penrith)Mellor, Sir J.Wakefield, Sir W W
Dower, E. L. G. (Caithness)Molsan, A. H. E.Walker-Smith, D.
Drayson, G BMorrison, Maj. J, G. (Salisbury)Wheatley, Colonel M. J
Drewe, C.Mott-Radclyffe, Maj. C. E.White, Sir D. (Fareham)
Eccles, D. M.Neven-Spence, Sir B.White, J. B. (Canterbury)
Fletcher, W (Bury)Nield, B. (Chester)Williams, C (Torquay)
Fraser, H C. P. (Stone)Noble, Comdr. A. H. P.Williams, Gerald (Tonbridge)
Fyfe, Rt Hon Sir D. P. MO'Neill, Rt Hon. Sir HWillink, Rt. Hon H U.
Gage, C.Orr-Ewing, I. L,Willoughby de Eresby, Lord
Gammans, L. DOsborne, C-York, C
Glyn, Sir R.Peake, Rt. Hon. O
Gomme-Duncan, ColPeto, Brig, C. H. MTELLERS FOR THE NOES:
Gridley, Sir APickthorn, K.Mr. Studholme and
Crimston, R. VPonsonby, Col. C EMajor Ramsay.
Hannon, Sir P (Moseley)Raikes, H V

Question again proposed, "That those words be there added."

I would point out to the hon. Member that by general agreement of the Committee a discussion took place on this matter on an earlier Amend- ment, when it was agreed that this Motion should be put formally.

On the other hand, I did want to ask a question on a matter which I do not think has yet been touched upon. I tried to put it on the earlier Amendment.

That may be, but when agreement is come to by the Committee as a whole, hon. Members must abide by that agreement, even if the decision was taken in their absence, as was no doubt in the case of the hon. Member in this instance.

In the circumstances, I will bow to the general convenience of the Committee. On the other hand, surely an agreement of that kind is not entirely binding on every Member, otherwise it makes it very difficult because we cannot be present in the Commitee all the time?

I am afraid I must differ. I appreciate the difficulty of the hon. Member, but the agreement is nevertheless binding.

Question put, and agreed to.

Schedule, as amended, agreed to.