I beg to move, in page 14, line 7, at beginning, to insert the words
Subject to the right of corporations to submit accounts made up to the thirtieth day of June, nineteen hundred and twenty-four.
I do not think this Amendment is at all controversial, and I hope the Chancellor of the Exchequer will be able to accept it. I simply want to make sure that there is no doubt in this matter and that business affairs shall have fair treatment.
The object which the hon. Member wishes to secure by this Amendment is one of which I completely approve, but the hon. Member is evidently not aware that that object can be attained under the existing law. Section 54 of the original Act, the Finance Act, 1920, provides that where the accounts have been made up for a greater or smaller period than 12 months
the accounting period shall be such period not exceeding twelve mouths as the Commissioners of Inland Revenue may determine.
Of course, under that provision, where the accounts are made up to the 30th June, 1924, to determine the accounting period ending on that date, it is the intention of the Commissioners that the date in question should be accepted. I think the hon. Member may take my assurance that his object will be attained under the present law.
I wish to eliminate this Clause, which is the exemption from Stamp Duty of securities
issued under the Treaty of Lausanne. I fully realise the position of this Clause, and it is only with one object that I and my hon. Friends have put down an Amendment to eliminate it. Perhaps for the guidance of the Committee I might state what is contained in Article 49 of the Treaty of Lausanne. It is as follows:
If Turkey shall decide to create new seen securities in respect of her share, the distribution of the capital of the Ottoman Public Debt shall be made in the first instance as it affects Turkey by a Committee consisting of the representative of the Turkish Government, the representative of the Council of the Ottoman Public Debt, and the representative of the debt other than the Unified Debt and the Lots Tures. The new securities shall be delivered to the Commission, which shall ensure their delivery to the bondholders upon such terms as will provide for the release of Turkey from liability and the rights of the bond holders towards time other States which are liable for a share of the Ottoman Public Debt. The securities issued in respect of the share of each State in the Ottoman Public Debt shall be exempt in the territory of the High Contracting Parties from all stamp duties or other taxes which would be involved by such issue.
It is because I realise that these Stamp Duties may not be chargeable that I hope the Chancellor of Exchequer will not agree to this Clause until he is satisfied with the position of the bondholders, and also in regard to the Decree of Muharrem. I have put several questions to the Prime Minister in regard to this Decree, and I feel that British investors have not been protected sufficiently in regard to the Decree. This Decree in the old clays was really the sheet anchor of Turkish credit, and it has been bought at big price by investors in these Turkish securities. Therefore, I feel that the Decree belongs to the security of these Turkish bondholders. I have no personal interest in Turkish securities, and I have not been asked to move this Amendment. I move it in the hope of protecting British investors in foreign securities.
This Decree has been in existence since 1875. It was reorganised in 1881, and the bondholder had to accept a lower denomination for their bonds. They were given this Decree as a bargain, and I do feel that before we pass this Clause into law—although if the Treaty of Lausanne is ratified it will be necessary that it should go through—we should have something definite in regard to the position of the Decree of Muharrem and the investors in these Turkish securities. We are so apt, and it has been the case in the past, to ignore British investors in foreign securities. Therefore, I press the Chancellor of the Exchequer as far as he can to protect these investors in foreign securities, especially when a security has been taken away in the existence of which the bondholders have a right as part of their security. This question was raised in another place, and a certain amount of satisfaction was given in regard to this Decree. Turkey has foolishly defaulted in regard to these bonds.
That was the point with which I was endeavouring to deal. I was endeavouring to show that under Clause 49 of the Treaty with Turkey Stamp Duty would not be charged on the new bonds, and I was hoping to protect the investors by suggesting that this Clause should not become law until there was something definite with regard to the security of these bondholders.
My hon. Friend is objecting to this Clause, and I think rightly so. You rule that he is out of order. My hon. Friend has given reasons why no relief should be given to Turkey, and I submit that he is in order in trying to show that no relief should be given to Turkey, and that, therefore, this Clause should not stand.
The decree of Muharrem belongs to the bondholders. By the Treaty of Lausanne we have given up that security for nothing. The bondholders are not even recognised now. The bonds, according to this Clause, are to lose the Stamp Duty. I suggest that this Clause should not become law until the security of the bondholders is specified by the Chancellor of the Exchequer.
It appears that Turkey has been excused her obligations by the operation of the Treaty of Lausanne. What my hon. Friend is trying to do—and I think he is right and I shall support him—is to draw public attention to the fact that the British Government, somehow, usually fails to give any sympathetic support to British investors who have been induced to lend their money abroad, and whose confidence has been abused and their money taken from them. Nevertheless, the Treasury comes along, and says that these people who have robbed British investors should have the advantage of not having to pay any stamp duty on their new bonds, which are to be substituted for the old bonds under the Decree of Muharrem. The Chancellor of the Exchequer will tell me that the more money we invest abroad the more likelihood there is of obtaining employment for our people.
That is—I hope the hon. Member will not resent what I am about to say—almost a childish observation. We want to increase our export trade. The way in which we can increase our export trade is to give credit to foreign countries, who can take that credit in the form of manufactured goods, and help us. That is just as much an axiom as the law of gravity is an axiom. The payment does not go out in the form of Treasury notes or coin tied up in sacks with string——
I think the Treasury shows very little appreciation of the difficulty of the British investor when it comes along and makes a proposal like this to excuse these people abroad. Their efforts ought to be directed towards helping British capital abroad. It is in order to make a protest against the action of the Treasury in excusing these people from the payment of stamp duties that we move this Amendment. We ask the Chancellor of the Exchequer, what is his view? Why should he give this advantage to these Turkish people, seeing that they have taken our capital and abused it? I have no personal interest whatever in Turkish securities.
I cannot help feeling that there is some misunderstanding on this subject. This question arises from the division of territory following the Balkan Wars and following the Lausanne Peace Treaty. It simply amounts in practice to a provision in respect of the division of the pre-War Ottoman Debt. It is believed that under the redistribution of territory it may be necessary to split up, say, £100 of pre-War Ottoman Debt, into some smaller portions making up that sum. The Commission took the view that it would be inequitable to impose Stamp Duty upon the mere replacement of the original bonds. That is all that is at stake so far as this Clause is concerned. Of course the practical difficulty with us to-night is that this is merely carrying out one of the Clauses of the Treaty of Lausanne, to which, I am afraid, we are bound. If I argued for a week I am not aware that I could give additional information. That is a simple explanation of what we have to do. The House will realise that I could not possibly go into the Decree of Muharrem, which was discussed indirectly while the Lausanne Treaty was before the House. In any event, those are largely matters for the Foreign Office rather than for us. Our position is confined to implementing our bargain under the Treaty of Lausanne by exempting the pre-War stock.
Perhaps I had better read the precise words of Article 49—
The securities issued in respect of the share of each State in the Ottoman Public Debt shall be exempt in the territory of the High Contracting Parties from all stamp duties or other taxes which would be involved by such issue.