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European Community (Capital Expenditure Grants)

Volume 981: debated on Friday 28 March 1980

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asked the Chancellor of the Exchequer what sums of money have been received from European Economic Community agencies by public bodies in the United Kingdom in grants towards capital expenditure; and what tax revenue has been collected on these sums by the Inland Revenue, in each of the years since the United Kingdom's accession, to the European Economic Community:

Most payments made to the United Kingdom by the European Community are either made in support of current expenditure or are passed on to private sector bodies. Grants paid to public bodies in respect of, capital expenditure amount to:

£ million
19751·6
197619·5
197729·6
197828·1
197943
These grants are not normally liable to corporation tax but since capital allowances are, in general, due only on the part of the capital expenditure borne by the taxpayer, the receipt of the grant may reduce the allowances. This does not affect the majority of cases where the public bodies are local authorities or regional water authorities, which are exempt from corporation tax. I regret that insufficient information is available centrally to make an estimate of the tax involved.