Capital Gains Tax

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

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Photo of Mr Simon Digby Mr Simon Digby , West Dorset 12:00 am, 9th March 1965

asked the Chancellor of the Exchequer whether capital gains tax will fall on farm stock and working capital on every change of farm, whether owned or tenanted, by a farmer.

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

asked the Chancellor of the Exchequer if he will exempt from his proposed capital gains tax gains which are made on works of art originally purchased from the artist.

Photo of Mr Henry Brewis Mr Henry Brewis , Galloway

asked the Chancellor of the Exchequer whether he will take into account when preparing his new capital gains tax that the financial returns of small woodland owners come from infrequent sales of timber and that, averaged over a period of years, such returns do not exceed 3 per cent. per annum on the capital represented by their woodlands.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

I have noted the points which the hon. Gentlemen make, but I must ask them to await my right hon. Friend's legislative proposals.

Photo of Mr Simon Digby Mr Simon Digby , West Dorset

Will the hon. and learned Gentleman bear in mind that there are many young farmers whose ambition it is to move to a larger farm and that there are far too few farms becoming vacant? Even if another farm became available, is he aware that if this tax falls heavily on a young man before he moves he will be tempted to stay in the smaller farm?

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

I will take note of that point.

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

Is the hon. and learned Gentleman aware that his right hon. Friend has anticipated his Budget statement on a capital gains tax and will he not go a little way to meet the point in my Question No. 15? Is he aware that it this concession is not granted irreparable harm will be done to artists, painters and sculptors? Will he look at the problem seriously to see whether he cannot make a concession?

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

I cannot say more about my right hon. Friend's Budget statement, but I will bear that point in mind.

Photo of Mr Joel Barnett Mr Joel Barnett , Heywood and Royton

Is my hon. and learned Friend aware that at present Income Tax and Surtax are charged on increases in farm stock and working capital on charges being made and that to discriminate in this way by a capital gains tax could well lead to a situation in which there could be the evasion which we had before farms were assessed under Schedule D?

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

It is for those sorts of reasons that we are proposing to introduce the tax.

Photo of Mr James Prior Mr James Prior , Lowestoft

Is the hon. and learned Gentleman aware that this is a serious point? Is he having consultations with the National Farmers' Union and other organisations concerned with farming and the countryside about the imposition of this tax?

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

Yes, Sir. We are having representations from many organisations. We are glad to receive and consider any such representations.