New Clause. — (Exemption of transfers of stock guaranteed by Treasury.

Orders of the Day — Finance Bill – in the House of Commons at 12:00 am on 16th July 1947.

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(1) Where the payment of principal and interest on any stock to which this Section applies is guaranteed by the Treasury, transfers of the stock shall be exempt from all stamp duties.

(2) This Section applies to all stock issued by any of the following bodies, that is to say:

  • The British Overseas Airways Corporation;
  • The North of Scotland Hydro-Electric Board;
  • The British European Airways Corporation; and
  • The British South American Airways Corporation;
and to any other stock to which it may be applied by direction of the Treasury, being stock issued by a body corporate constituted for the purposes of any scheme for the carrying on of any industry or part of an industry, Or of any undertaking, under national ownership or control which may be embodied in any Act passed after the beginning of the present Session.—[Mr. Glenvil Hall.]

Brought up, and read the First time.

5.30 p.m.

Photo of Mr William Hall Mr William Hall , Colne Valley

I beg to move, "That the Clause be read a Second time."

This is a straightforward Clause in simple language, unlike other Clauses we have had to consider. Its object is to exempt from Stamp Duty the transfer of certain stocks which are issued by corporations carrying on nationalised undertakings and stocks which are guaranteed by the Treasury. As the House knows, all transfers of Government stocks are exempt from Stamp Duty under the provisions of the Stamp Act. The stocks covered here and issued by many of the nationalised undertakings are not, strictly speaking, Government stocks, although they are guaranteed by the Government. Therefore Stamp Duty would have to be paid on that. The effect would be that whereas Government stocks reflect in their price the fact that no Government duty is chargeable on transfers, there would be this type of stocks, which are also in a sense Government stock in that they carry with them a Treasury guarantee at a lower price because they would be subject to tax. It is, therefore, proposed in this new Clause to put them on the same footing as Government stocks so far as Stamp Duties are concerned.

It will be noticed that in Subsection (2) of the new Clause public bodies are named. B.O.A.C. has made an issue, but so far it has not been in the strict sense a public issue. I understand it has been taken up by the National Debt Commissioners. The North of Scotland Hydro-Electric Board are in process of making an issue. Those are the only two issues which have so far been made by the bodies listed here. National Coal Board stock will, of course, be Government stock. The Central Electricity Authority and British Transport stock will, subject to conditions laid down here, by direction of the Treasury, be able to take advantage of this Clause, if it is accepted.

Photo of Mr Ralph Assheton Mr Ralph Assheton , City of London

Does the right hon. Gentleman think that this Clause will save the Exchequer money, or cost the Exchequer money?

Photo of Mr William Hall Mr William Hall , Colne Valley

the Exchequer hardly comes into it. The only people who can come into it are the public, if the transferee had to pay the duty, or the corporation, as many corporations compound for Stamp Duty. I am told that in the case of the new Transport Board, the cost of Stamp Duty for the railway compensation stock alone would be in the neighbourhood of £3¼8 million. So it will certainly save these new nationalised boards money, but not, of course, save the Government money directly.

Photo of Mr Ralph Assheton Mr Ralph Assheton , City of London

Although there may be a loss of Stamp Duty to the Government over a considerable period of years, as long as transactions take place in these stocks, none the less the Government must have reason for making the proposal. Is the reason that the stock which will be issued to the various holders of railway stocks and so on will be issued one point dearer, as it were, as Stamp Duty will not be chargeable? If that is the case, I can see the point of the Clause, and welcome it.

Photo of Mr Hugh Dalton Mr Hugh Dalton , Bishop Auckland

I think that is correct. I think the absence of Stamp Duty would have that effect.

Clause read a Second time, and added to the Bill.