Export Rebates

Oral Answers to Questions — National Finance – in the House of Commons at 12:00 am on 9th March 1965.

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Mr. Gresham Cooke:

asked the Chancellor of the Exchequer whether he is aware that German exports receive a rebate of the order of 5 per cent. to 6 per cert. of factor costs in relation to their turnover tax; and whether, in view of the fact that present taxation in the United Kingdom is estimated to amount to about 14·3 per cent. of the factor costs of British industry, he will increase the present export rebate for export goods.

Photo of Mr James Callaghan Mr James Callaghan The Chancellor of the Exchequer, Member, Labour Party National Executive Committee

A comparison cannot be made in this form, as the different rebates reflect entirely different systems of taxation.

Mr. Gresham Cooke:

That may be so, but would not the Chancellor of the Exchequer agree that it shows that a very real advantage is obtained by German exporters and exporters in other countries which have a similar system over British exporters? There is a very big differential here. Would he look again at this problem and see if something can be done in the forthcoming Budget to lessen the differential?

Photo of Mr James Callaghan Mr James Callaghan The Chancellor of the Exchequer, Member, Labour Party National Executive Committee

As it is impossible to compare like with unlike, I cannot be as dogmatic as the hon. Gentleman is about this. If he and I have had access to the same sources of information—and I think that we have—then I think that much of the information he has read would be challenged if it were exposed to examination.