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Capital Transfer Tax

Volume 886: debated on Wednesday 12 February 1975

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4.

asked the Secretary of State for Scotland what representations he has received with regard to the effect of the proposed capital transfer tax on farming in Scotland.

I have had representations about the possible adverse effects of the tax on farming structure and efficiency from the National Farmers' Union of Scotland and the Scottish Landowners' Federation, and from a few individual farmers.

I should first declare an interest in this matter. Does the Minister feel that a son or daughter has the right to inherit the father's business, be it a small business or a farm? Does he not feel that the confiscation level of CTT will mean that large units will be broken up and will become less efficient?

I do not think there is any inherent right for sons or daughters in this matter. They may not necessarily wish to inherit a farm. In order that they should be treated fairly, and bearing in mind that the argument is that one should ensure the efficiency of farming, I assure the hon. Gentleman that the representations received by my right hon. Friend the Secretary of State for Scotland, including those from the meeting with the SNFU, have been passed on to the Chancellor of the Exchequer.

Is the hon. Gentleman aware that there is some anxiety about the figure of 1,000 acres, owing to the low value of hill land in Scotland? Am I right in thinking that the Government will put this matter right in Committee?

The whole matter is under review. I am sure the right hon. Gentleman will be aware of the concessions which have already been announced by the Chancellor of the Exchequer. The fact that land prices have fallen minimises the value of the concessions, and it is this aspect which is still being looked into.

Will the hon. Gentleman accept that this is not good enough? Will he understand that what his Government are proposing will destroy the present structure of agriculture in Scotland in relation to both owner-occupied farms and forestry? This will have a devastating effect on the farm side of the industry and on forestry workers. Will he put pressure on the Chancellor to give greater concessions than are offered at present?

I know that some hon. Members opposite are only half Scots. While the hon. Member may be fighting for his place on the Opposition Front Bench, he should recognise the genuine value of the concessions already announced. We recognise, of course, that there must be a continuing prosperous and profitable agriculture industry.

In view of the Minister's amazing answer to the supplementary question put by the hon. Member for Bute and North Ayrshire (Mr. Corrie), will he confirm that the Government support, in the case of tenant farmers, the rights of succession to these farms?

I do not know what was amazing about my reply. I thought it was a very good one. The hon. Member is confusing two different things. There is security of tenure for tenant farmers in Scotland—a security which was created by the present Government—and it is better than that existing in England and Wales. I do not understand the hon. Gentleman's point.