House Building Costs (Selective Employment Tax)

Oral Answers to Questions — Scotland – in the House of Commons at 12:00 am on 15th June 1966.

Alert me about debates like this

Photo of Hon. Thomas Galbraith Hon. Thomas Galbraith , Glasgow Hillhead 12:00 am, 15th June 1966

asked the Secretary of State for Scotland how much extra he estimates the Selective Employment Tax will add to the cost of building the average council house and to the cost of an average private house.

Photo of Mr William Ross Mr William Ross , Kilmarnock

The tax is likely to add on average about 2 per cent. in each case, but the lifting of the import surcharge and the new investment grants should enable the builders to absorb part of this.

Photo of Hon. Thomas Galbraith Hon. Thomas Galbraith , Glasgow Hillhead

Two per cent. on the cost of a house is quite a substantial sum of money. How does the right hon. Gentleman expect to encourage people to build houses when this increase is imposed upon them? Will not he ask his right hon. Friend the Chancellor of the Exchequer to remove the burden of the Selective Employment Tax from people building houses?

Photo of Mr William Ross Mr William Ross , Kilmarnock

The hon. Member should appreciate that in our economic circumstances an additional burden of taxation was required. If another form had been used it might have had an even more depressing effect upon the economy, and particularly upon Scottsh house building.

Photo of Mr Gordon Campbell Mr Gordon Campbell , Moray and Nairnshire

Can the right hon. Gentleman yet tell us whether direct labour forces belonging to local authorities will have the tax refunded to them?

Photo of Mr William Ross Mr William Ross , Kilmarnock

That is an entirely different question. If he will put it down I shall be glad to give him an answer.

Photo of Mr Jon Rankin Mr Jon Rankin , Glasgow Govan

Did my right hon Friend observe that, just the other day, Glasgow Corporation refused to grant a contract to a prospective builder because he tried the dodge referred to by the hon. Member and instead gave the contract to direct labour?

Photo of Mr Michael Noble Mr Michael Noble , Argyll

Does not the right hon. Gentleman agree that although 2 per cent. by itself may not sound a great deal, it is 2 per cent. on top of an already steeply rising house-building cost?

Photo of Mr William Ross Mr William Ross , Kilmarnock

The right hon. Gentleman should know all about steeply rising house-building costs, because they occurred while he was Secretary of State. [Interruption.] Oh, yes—in 1964 the increase was 10 per cent., and he did nothing about it. I hope that it will stimulate increased efficiency in the use of labour in the building industry.